johnsonjt3’s Recent Comments

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  "Don't Buy Mobil or Exxon"

  "Don't buy Mobil" or "Don't buy Exxon" is never going to amount to any reductions at the pump.  Here's my take on why ...

  Fifteen years ago or so, the EPA started putting pressure on the oil companies and small refineries to clean up or shut down.  Many shut down, dismantled their equipment and sold it to overseas buyers.  Production capabilities were drastically reduced.  Independents were out of the refining business and what was left was all owned by the Big Boys.

  They were smart ... they keyed in on the Law of Supply and Demand and looked to the future. Don't build any new refineries ... the laws are too stringent and make any new operations too expensive to build ... just sit back and wait for demand to increase ... even if crude oil is available, we can only produce so much per day. When we reach capacity, or close to it, demand will drive the price up.  We can get away with it ... our customers have no place else to go, and we have almost everyone in the federal government in our back pockets. We are also smarter than them. When they yell and scream, we can point our fingers back at them and say, "The EPA forced us to shut down old refineries"; "They made it too expensive to build new ones"; "We wanted to build a couple on the West Coast but the Californians wouldn't let us"; "We wanted to build a couple on the East Coast, but New Englanders wouldn't let us".  If the vast majority of refineries weren't located along the Gulf Coast, do you think the Big Boys could holler, "That will be another ten cents per gallon for the next six months. We had to shut down the Louisiana plant for a couple of weeks because of the storm".

  We really are stupid.  The Big Boys have us by the "you know what's" and we really don't have any way out.  We can start pumping new stuff out of the ground in Alaska; we can start drilling off the California coast; we can become best of friends again with all the Middle Eastern producers ... the price still isn't coming down because enough is never going to get refined to satisfy our demands.

  So here's what I'm saying ... the key to any type of "recovery" is to build new refineries ... get some competition going.  Maybe the U.S. government should build, own and operate a couple of them.  Right now, the Big Boys are all in cahoots with each other. You think that they don't strategize together? Develop gameplans together?  Fix pricing together?  Fund PAC's together?  Lobby Congress together? They have to be confronted with competition before they will change.  Where in the hell is it going to come from?On The latest solution to pumped-up prices posted 4 years, 2 months ago 11 Responses