In a recent interview with Fox Business, American Petroleum Institute President Mike Sommers stated that 11 US gas refineries closed over the past two years. Has Saudi Arabias Relationship With Russia Reached Its Limits? With prices for your products where they are today, you have ample market incentive to take these actions, Biden writes, and I recognize that some of you have already begun to do so. Bidens own Energy Information Administration reported last week that the industry was working at a very high utilization rate of over 94%. Given that the longer term direction of travel is away from oil and toward renewables, however, the more forward thinking companies are probably those which are pivoting their refinery sites toward renewable technologies. On Thursday, the. De Haan added that one wild card could be Hurricane Ian, which, as of Monday, was approaching the Gulf Coast. This is so, so frustrating, Hogan said. Most of the refinery closures occurred in western countries, the data showed. Overall, its throughput in Q3 was 1% up on the year at 1.225 million b/d, but 29% down from 2019. In one particularly unusual move, India's Reliance Industries said it would simply sell the crude oil that it had in transit at sea, rather than allowing the cargo to arrive at its refineries. In Pursuit Of Higher Value, Big Oil Isnt Losing Any Sleep Over The EV Revolution, Mining Majors Are Treading Carefully As Battery Metals Boom. What the letter does not recognize, of course, is the role the federal government, pressured by climate change interest groups, has played in creating the current shortage of domestic refining capacity. the successful shut down and closure of the Houston Refinery, including within the expected timeframe; the outcome of . President Joe Biden has repeatedly slammed the U.S. fossil fuel industry for allegedly profiting while Americans are suffering from high gas prices, and he resists expanding refinery capacity, even as he continues to hobble producers, including delaying lease . According to a report from Reuters, published in June of this year, the refining capacity across the US fell by 4.5% during 2020, the largest drop since the recession of 2012. Colorado's only oil and gas refinery is offline and might not resume full operations until March, raising concerns about gas prices and local air quality after a series of recent incidents. The refinery had already been idle for a decade before restart. At Separo weve spent many years earning a global reputation for the excellence and flexibility of our tank cleaning and recovery services. The Environmental Protection Agency under President Joe Biden is set to abruptly issue a sweeping denial of economic hardship exemptions to the Renewable Fuel Standard (RFS) program from small oil refineries around the U.S., likely forcing one Texas refinery to go out of business at a time when American energy independence is desperately needed. Could Gravity Batteries Win The Energy Storage War? (LogOut/ The American Petroleum Institute (API), which represents most if not all of the companies targeted by the Presidents letter, responded with a letter of its own, offering a laundry list of 10 actions the administration could take to incentivize and enable the industry to start to reverse the capacity shortage. US President Joe Biden departs Marine One after, arriving in Washington, D.C., US, on Tuesday, June 14, 2022. Meanwhile, the operator made modifications in 2014 and 2015 to process 3,500 barrels of vegetable oils and beef tallow per day. Valeros (NYSE: VLO) Texas City 225,000 bpd refinery has also shut down. The plant was sold to a Jamaican oil storage facility in December 2021. read more. The permitting and building of a new greenfield refinery would take at least a decade; major expansions take several years from cradle to startup. These closures were temporary, of course, but they serve to underline how fragile the infrastructure upon which the industry is based can be, and how external events of varying size and type can lead to not just interrupted operations but complete shutdowns. On March 30, North Atlantic Refining Ltd announced the first refinery to shut down in North America. U.S. gasoline inventories started their most recent build streak during the last week of 2021, gaining 27.4 million barrels since December 24, according to EIA data. There was already some contraction happening in the industry as a result of projected declines in U.S. gasoline demand into the future and companies just deciding that the assets were better used as other projects or shut down completely, he continued. Biden spoke at the 29th AFL-CIO Quadrennial Constitutional Convention in Philadelphia. The refinery is among the top 25 largest-capacity facilities in the U.S., according to the Energy Information Administration. Editing by Nick Zieminski, Exclusive: Biden administration to move on Midwest ethanol-blended gasoline rule this week -sources, Greta Thunberg detained by Norway police during pro-Sami protest, Norway's Equinor nears deal to buy Suncor's UK oilfields, Dollar Tree sees weak 2023 profit as costs mount, shoppers curb spending, EU silence over Pfizer COVID contract talks is problem that won't go away -watchdog, Russian internet speeds drop on hardware shortage, research finds, Kohl's swings to surprise loss as margins crumble on steep discounts, Enbridge to buy US Gulf Coast gas storage facility for $335 million, Exclusive news, data and analytics for financial market professionals. Total gasoline inventories in the United States have been slowly building over the last few weeks, ending at 250 million barrels as of January 28, before the storm. In addition, five refineries with a capacity of 408,100 bpd of oil are idle, the largest number of idle refineries since 2012. The drop in capacity was driven by a 13% drop in gasoline consumption, and prices for gasoline and diesel hit a four year low. We average between 2 and 3 posts a day. Covid and oil demand took divergent directions in mid-2020. hide caption. PETALUMA, CALIFORNIA - MAY 18: A customer pumps gas into their car at a gas station on May 18, 2022 in Petaluma, California. According to Gas Buddy, the online monitor that tracks fuel prices by community, Santa Rosas lowest-priced gas is being sold at the 7-Eleven on College Avenue, where regular unleaded was $5.29 per gallon, as of Monday. President Biden and Big Oil are at each other's throats. HollyFrontier Corp said in June 2020 it would convert its Cheyenne refinery into a renewable diesel plant that would produce 6,000 bpd of renewable diesel. But on Monday, at that same Safeway, Prince paid $5.39 per gallon to fill his Mazda 6. TOLEDO, Ohio (WTVG) - The company operating a pipeline serving Midwest refineries says it's ignoring an order by Michigan's governor to shut down as she threatens to go after the company's. The Houston Refinery is currently operating as planned, LyondellBasell said in a statement Tuesday to The Daily Caller News Foundation. A key Texas petroleum refinery that produces more than 200,000 barrels of fuel per day is facing a premature shutdown that could increase pressure on domestic fuel supplies. As for turning back on idled refineries, that's not a quick fix either. Chevron CEO Mike Wirth recently stated as much in an interview with Bloomberg. Enter your email address to follow this blog and receive notifications of new posts by email. No portions of this website may be reproduced, retransmitted, copied, or republished without expressed written consent from Shore News Media & Marketing, LLC. Sonoma Countys average on Monday was $6.03 per gallon, which was outpacing Californias overall average of $5.80 per gallon. And there's a good chance it never will. When a recent Emerson poll asked Americans why they thought gas prices were so high: READ: Survey: Plurality Blame Joe Biden for High Gas Prices, RELATED: Biden Presses Oil Industry to Increase Production as Refineries Already Running at Full Capacity, Pingback: Eleven US gas refineries closed over the past 2 years OpentheWord.org New Human New Earth Communities. That would be a pretty clear antitrust violation, Borenstein said. Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. Shutdowns, or at. Any trading and execution of orders mentioned on this website is carried out by and through OPCMarkets. In our interview last week, S&P Global Vice Chairman Dan Yergin expressed the concern that national leaders in the U.S. and Europe might resort to enacting what he called panicky policies in response to what is without question the worst energy crisis of this century. Unless otherwise stated, photos Big Stock Photography Dreamstime Photos Google Maps Thompson Reuters. Meanwhile, six refineries with a capacity of about 801,000 bpd of oil have shuttered over the last two years amid the pandemic, federal data showed. Our Standards: The Thomson Reuters Trust Principles. Indeed, Galp halted operations at the Matosinhos oil refinery complex in Portugal from early 2021, citing a 16% drop in throughput in the fourth quarter of 2020. This would be the latest step in wider moves to shift the company as a whole onto a more environmentally sustainable footing, with two other refineries in Italy already having undergone a similar conversion. Patrick De Haan, Gas Buddys head of petroleum analysis, said in a statement that prices in the impacted areas could go up another 25 to 75 cents before the issues are resolved. Merchant of Record: A Media Solutions trading as Oilprice.com, That email address is already in the database. Education: BA, Marquette University. Fire broke out in the early morning that triggered a vat of butane to ignite with an explosion so large that it was detected from space. June 17 (Reuters) - Since the onset of the global pandemic, the United States has lost nearly 1 million barrels per day of oil refining capacity, with more set to be shuttered in the next few years. Shell announced in November 2020 it would be shuttering the refinery after attempts to sell the plant between July and October were unsuccessful. LyondellBasell previously announced it will cease operations of the Houston Refinery no later than December 31, 2023. LyondellBasell will be closing its Houston refinery and exiting the refining industry, according to a filing with the Securities and Exchange Commission (SEC). Louisiana's 17 oil refineries account for nearly one-fifth of the nation's refining capacity, with the ability to process about 3.4 million barrels of crude oil per day, according to the . For licensing opportunities of our original content, please contact Daily Caller News Foundation, Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher thatcan provide a large audience. Given the highly-ideological nature of this administration and the fact that most of APIs suggestions would conflict with Bidens Green New Deal-based agenda, most if not all of them are likely to fall on deaf ears. Not all of those refineries have come back online. read more. Why are refineries closing amid oil price windfall? "When you're losing money on doing it, what do you do? Find out more about how we use your information in our privacy policy and cookie policy. All defendants in crime reports are presumed innocent until proven guilty. More than 1 million barrels a day of the country's oil refining capacity or about 5% overall has shut since the beginning of the pandemic. Friday, February 11, 2022 3:56 am. US governments accomplished this through various methods, including increasingly restrictive environmental regulations. In addition to the shutdown of refineries, at least two are set to be converted to biofuel production. Elsewhere in the world, capacity has shrunk by 2.13. Strikes Back At EU Criticism Of The Inflation Reduction Act, China Secures Two Long-Term LNG Deals With U.S. Producer, Oil Gains Over 2% As Gasoline Stocks Show Second Weekly Decline, Russia Says Europe Will Struggle To Replace Its Oil Products, "Natural Gas Price Fundamental Daily Forecast Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas, 'Get A Loan,' Commerce Chief Tells Unpaid Federal Workers, Shell Considered Relocating To The U.S. Some of its been very policy-driven and companies decided that it wasnt worth it to keep operating those assets.. HollyFrontier shut all units as of the end of August 2020 at its 48,000 barrels per day refinery in Cheyenne, Wyoming. Please, Saudi Aramco Looks To Invest In LNG Export Facility Abroad, European Natural Gas Prices Post Longest Monthly Losing Streak Since 2020, Alberta Eyes Massive Budget Surplus Thanks To High Oil Prices, U.S. Crude Oil Inventories Continue To Build, Russias Oil Exports Still Strong Despite Sanctions, Russian Oil And Gas Project Misses Output Targets After Exxon Exit, Gazprom Neft: Russian Oil Output Cut Will Help Balance The Market, BPs CEO Warns Of Oil And Gas Price Spikes If Energy Transition Is Rushed, House Republicans Look To Block ESG Investing In Retirement Plans, Chevron Hikes Annual Share Buyback Target To $17.5 Billion, BP To Stop Publishing Statistical Review Of World Energy After 71 Years, Shale CEO Highlights What Argentinas Oil Industry Needs To Flourish, Japan Steps Up Efforts To Build Nuclear Fusion Reactor, U.S. Natural Gas Futures Hit One-Month High, UK Households Brace For Higher Energy Bills In April, Kazakhstan Enters New Era Amid Strong Demand For Its Commodities, Rio Tinto Signs Iron Deal With One Of Chinas Top Steelmakers, Mexico's Oil Giant Reports Staggering Losses, U.S. Pour en savoir plus sur notre utilisation de vos informations, veuillez consulter notre Politique relative la vie prive et notre Politique en matire de cookies. Operating refinery capacity in the US has decreased since 2020 Over the last three years, more than 1 million barrels a day of refining capacity went offline a s a result of the pandemic and extreme weather. The U.S. hasn't constructed a major petroleum refinery since 1977 even as fuel demand and domestic oil production have surged in recent decades. Global refining, which is vital for producing fuels like gasoline and diesel, decreased by 1.4 million barrels a day between 2019 and the first quarter of 2022, according to the International Energy Agency. Prices skyrocketed in February when Russia invaded Ukraine, an action that had resounding impact on the global supply of crude oil, which itself directly affects gas prices. "I think the refining executives say, well, looks like the writing's on the wall," Cinquegrana says. And that's when you shut down refineries," says Denton Cinquegrana, chief oil analyst at Oil Price Information Service. The two shareholders of the refinery will implement a spending freeze and pause refinery operations at Sapref no later than the end of March 2022 as they will attempt to find a buyer for the. Copyright 2023 Separo. The President might believe that a heavy-handed action to implement price controls or other actions could offer him some short-term political advantage leading up to the November elections, but in the mid-to-long-term it would only result in less availability of the products being controlled. In a recent interview with Fox Business, American Petroleum Institute President Mike Sommers stated that 11 US gas refineries closed over the past two years. Refineries Shutting Down South Africa is refining less crude oil and only two refineries remain operational as it has become increasingly expensive to operate refineries and more. if(window.innerWidth <= 1023){ The president earlier this month singled out ExxonMobil, saying the company "made more money than God this year.". }. Monday, June 20, 2022 Industry Why are refineries closing amid oil price windfall? Phillips 66 announced in November 2021 that it would not reopen the Alliance refinery, which was shut in mid-August ahead of Hurricane Ida. Change), You are commenting using your Twitter account. It would take months to bring the refineries back online, and it would be costly for the refiners. So President Biden wants them to do more to bring down the price of gasoline. By Alex Kimani - Dec 29, 2022, 11:00 AM CST. Click Manage settings for more information and to manage your choices. This proved not to be the case in February of this year, however, when unseasonably freakish arctic weather temperatures dropped as low as -13C in Austin, -15C in Dallas and -23C in Amarillo led to the largest refineries in North America having to be shut down across the state. Until now, California fuel costs followed worldwide trends. (Photo by Justin Sullivan/Getty Images) Refineries will receive a maximum payment of 1.8 cents per litre when the margin they make per barrel of oil falls to $7.30. New York gas stations, for example, charged an average of $3.68 per gallon as of Monday, according to AAA. Shutdowns, or at the very least reduced production, have been reported at four California refineries, as well as at one in Washington, experts say. The refinery became unprofitable as COVID-19 spread across the United States. June 21, 2022 Why is Oil Refining Down? The industrial landscape for oil refineries has been challenging of late, with the Covid-19 pandemic triggering a massive slump in demand for oil which resulted in many refineries across the world having to temporarily shut down. Vous pouvez modifier vos choix tout moment en consultant vos paramtres de vie prive. Fire smolders at an oil refinery that triggered several large explosions at the Philadelphia Energy Solutions Refining Complex on June 21, 2019. 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