Selected Leader misses no opportunity to practice deceit and behave like a tyrant. He’s done it again.
President George W. Bush authorized the US Department of Energy to take crude from the Strategic Petroleum Reserve (SPR) for refiners that may be short of supplies.
Don’t be fooled! This action is an empty gesture for the following reasons:
* Refineries do not need it; they are over-stocked;
* Refineries cannot refine it; they are shut down due to Katrina;
* The amount Dubya’s authorized is equivalent to a single day’s output by those refineries if they were up and running.
[DISCLOSURE: First posted at DailyKos where it scrolled outta sight as I appear to have posted it during rush hour. Think you will agree, what you’re reading ties in nicely with susanhu’s front page story about Congressional ER Session. While I’m at it, requesting shamelessly that you recommend DK post as well, if you’d be so kind.]
According to an article by Sam Fletcher, Senior Writer, in Oil & Gas Journal that appeared online yesterday,
It will take weeks–perhaps months–to bring flooded, powerless Gulf Coast refineries back to operation and to restore oil and natural gas production to its former levels. . .
By industry estimates, it would take 2 weeks to get refineries operating again — but they can’t because there are no workers and no electric power. Add to that time frame another 2 weeks, which is what Entergy Corp., the supplier of electrical power to the Louisiana Offshore Oil Port — the biggest US port for importing crude, which survived Hurricane Katrina without damage — said it needs to reconstruct power line and string wire. That’s a minimum estimate.
Here’s what’s no longer being refined into consumer gasoline:
Analysts at the Houston office of Raymond James & Associates Inc. said: “Approximately 1.79 million b/d of refining capacity (10% of the nation’s total) has been suspended indefinitely due to shut-ins at eight refineries. . .”
Let’s assume those 1.79 million daily barrels represent the full-out capacity that refineries were operating at prior to Hurricane Katrina’s strike.
Plus,
“An additional total of 684,000 b/d of capacity is running at reduced rates at three other refineries.”
Further, let’s assume “reduced” means working at 50% of capacity. Under that scenario, 342,000 b/d are also not making it to the gas stations. For a grand total of: 2.13 b/d loss in production.
Now, just how much of that (unneeded) SPR crude did Bush magananimously release? Here ya go. . .
The supply of SPR crude “is likely to be 1-3 million bbl,” said Raymond James analysts.
That’s right — about a day’s output. That’s all.
Heck, even industry analysts don’t want it. Waste of time. Empty gesture.
“The main problem now for the US refined product market is not a shortage of crude oil (which is what the SPR contains). . .While the SPR oil may be useful in certain cases, in general the bottleneck will be at the refinery level.”
BushCo, isn’t offering “all the assistance we can,” as he promised in his empty-speech last night. He’s creating a windfall for his buddies in the oil business who have absolutely NO INCENTIVE TO INCREASE PRODUCTION at any refineries, anywhere.
Because even while
Commercial inventories of crude, excluding SPR, plunged by 1.5 million bbl to 321.4 million bbl, (they are) well above the upper end of the average range for this time of year.
at the same time,
US gasoline inventories currently are below historical averages, analysts said. On Aug. 31, the Energy Information Administration reported US gasoline stocks fell by 500,000 bbl to 194.4 million bbl during the week ended Aug. 26.
Exactly: supply at the pump is very low, demand at the pump is very high, and the Big Oil Fat Cats are sitting on a surplus of crude.
Pretend you’re one of them. Let the price at the pump run up to whatever the traffic will bear. Be sure NOT to supply regular, only premium grade fuel, to the gas stations. Sit back and watch the money roll in at an obscene clip. Then follow your energy stocks on the computer as they soar.
Every Have More will become a Have Even More Still.
And this has been the total estimated loss so far:
Cumulative production lost because of Katrina during the period of Aug. 26-31 totaled 6.1 million bbl of oil and 34.2 bcf of natural gas.
It doesn’t take much imagination to calculate that those “losses” will skyrocket over the next 4 weeks, until maybe — only maybe — they start cracking crude once again.
And it doesn’t strain one’s empathy to feel just a little bit on the side of the Have Nots who are prowling the streets of New Orleans, trying to equalize the distribution of wealth and close the gap on the separation of power. God help them, their Federal Government surely doesn’t give a damn!