Friday, May 04, 2007

Gasoline Prices

AAA says:
"The problem this year is our continuing and increasing inability to refine enough gasoline to meet growing demand," said Geoff Sundstrom of AAA. "I think it is very possible that we will set a new record high price this month."

I have trouble understanding the inability to refine gasoline with oil companies posting record multi-billion dollar profits. Help me understand this!!

Schork Group:
"U.S gasoline stocks have dropped by 15 percent in three months, with refineries now running at around 88 percent of capacity, well below the 92 percent analysts say is normal this time of year to build up summer gasoline stocks.
By this point in the season, nationwide gasoline inventories should be building, or at a minimum plateauing," Stephen Schork of the Schork Group said in a report.

If you have history, you have prior knowledge, why is this happening, why are they running at a lower capacity??

Their apparent issues:
New lower sulfur fuel specifications have forced refiners to increase the complexity of their equipment, making them more prone to outages.

The requirement has been known for years, the oil companies have been making record profits for years..... Why didn't they use some of these billions to make the necessary changes??

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