Joe Biden, President of the United States called for more gasoline production Wednesday. He warned that American oil companies aren’t producing enough fuel as Americans face record-high gas prices.
Biden’s federal government reports that the refineries have already reached their maximum capacity, and will face additional limitations as a result of the coronavirus pandemic.
The Energy Information Administration (EIA) reported in its June 2022 Short-Term Energy Outlook:
In the third and fourth quarters of 2022, we estimate that U.S. refinery outputs will be 16.7 million barrels per day. The average U.S. refinery inputs is expected to average 16.7 million b/d in 2022, despite the high utilization rate due to reductions in refinery capacities since 2020. The U.S. has lost nearly 1.0million barrels per day in refinery capacity since the beginning of 2020 due to several closed refineries or conversions.
Due to the high price of oil, refinery utilization is expected to rise by 96 percent per month. It will be close enough that they can maintain a consistent level. In June and July, we expect refinery utilization levels to be 96 percent, 94 percent, and 96 per cent respectively.
In the third and fourth quarters of 2022, we estimate that U.S. refinery outputs will be 16.7 million barrels per day. The average U.S. refinery inputs is expected to average 16.7 million b/d in 2022, despite the high utilization rate due to reductions in refinery capacities since 2020. The U.S. has lost nearly 1.0million barrels per day in refinery capacity since the beginning of 2020 due to several closed refineries or conversions.
And media reports reflect the same reality and that it is Biden’s energy policies that have caused the domestic shortages.
According to The Associated Press (AP), on Wednesday, the American Petroleum Institute responded to Biden with a response in writing. It blaming him for his climate change agenda as well as shutting down the largest portion of the fossil fuel sector since he took office.
It is unlikely that the letter will trigger a series of events to increase supplies. Claudio Galimberti (senior vice president, Rystad Energy) said that refineries around the world have been subject to unprecedented and unplanned maintenance in the past three months. This has led to an acute shortage of oil products across the globe. China’s decision to limit its exports of oil products also contributed to the problem, he said.
“U.S. refiners cannot increase capacity beyond current levels,” Galimberti said. “If they could, they would have done it already.”
National Public Radio, left-leaning and taxpayer-funded National Public Radio had difficulty in its usual defense of Biden in a report aired on Weekend Edition Saturday.
NPR interviewed people in the industry, including further damage down from coronavirus policies — “When demand for gasoline dried up, some refiners cut back. Denton Cinquegrana is with the Oil Price Information Service.”
“When you’re losing money on doing it, what do you do? You stop making it. And that’s when you shut down refineries, which we have seen happen,” Cinquegrana said. “You’re talking about a lot of money to get these refineries that are idled up and running. And when I’m being told, five years from now, we hope you don’t exist, why should I help you?”
NPR also mentioned a statement made by Mike Wirth (CEO Chevron) about the recent comments.
“My personal view is there will never be another refinery built in the United States,”Wirth said.
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