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Originally Posted by €uroMeinke
As for refineries, I'm not sure building more of bigger/better is really going to do much about the price of gas. It's a limited resource and world wide demand is on the increase. We still have it cheap - (I read an item yesterday that pegged the cost at $7 a gallon in France right now).
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We're in a disturbing in-between state right now.
We're seeing an increasing number of short-term issues due to the fact that refineries are running at capacity. In times of emergency (from things as major as Katrina to as minor as a small chemical fire that causes one refinery to shut down for a few days), there's no way to pick up the slack. So every little disruption in refinery output casues pretty immediate upward fluctuation in pump price. Some of it is real, some of it is paranoia, and some of it is the companies taking advantage of the situation. So from that perspective, more refineries seems to be a good answer.
But I think that only works if those refineries exist
now. If it's going to take, what, 10? 20? years, not so much. Most likely, by then, crude supply will be the limiting factor, and if there's any intelligence left in this world, alternate fuels sources will start erroding demand for petrolium. In that case, if they start opening shiny new refineries with no rude to refine and no customers to for the product, we're going to look pretty stupid.
So we're kinda screwed either way for a little while, the way I see it. There's not quick bandaid for the refinery capacity problem, and any long-term solutions will take so long as to be obsolete once they're ready for prime time. So we're just going to have to suck it up and deal with it for a while.