Chevron CEO says there may never be another oil refinery built in the US
Category: News & Politics
Via: vic-eldred • 2 years ago • 129 commentsBy: Breck Dumas (Fox Business)
S E E D E D C O N T E N T
Chevron CEO Mike Wirth says he does not expect another oil refinery to be built in the U.S. ever again, pointing to decades of federal government policies as the reason why.
"There hasn't been a refinery built in this country since the 1970s," Wirth said at Bernstein's Strategic Decisions Conference this week, when asked about the prospect of new capacity being added in the Gulf of Mexico. "I personally don't believe there will be a new petroleum refinery ever built in this country again."
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| CVX | CHEVRON CORP. | 154.58 | +6.34 | +4.28% |
"Capacity is added by de-bottlenecking existing units by investing in existing refineries," he explained. "But what we've seen over the last two years are shutdowns. We've seen refineries closed. We've seen units come down. We've seen refineries being repurposed to become bio refineries. And we live in a world where the policy, the stated policy of the U.S. government is to reduce demand for the products that refiners produce."
Wirth went on to list examples such as the Corporate Average Fuel Economy (CAFE) standards for fuel efficiency in vehicles that Congress first enacted in the 70s, the Renewable Fuel Standard created in 2005 requiring a certain amount of biofuels like Ethanol to replace petroleum-based fuels, and electric vehicle tax subsidies.
"At every level of the system, the policy of our government is to reduce demand, and so it's very hard in a business where investments have a payout period of a decade or more," Wirth said. "And the stated policy of the government for a long time has been to reduce demand for your products."
A view of the Phillips 66 Company's Los Angeles Refinery (foreground), which processes domestic and imported crude oil into gasoline, aviation and diesel fuels, March 11, 2022. ( REUTERS/Bing Guan / Reuters Photos)
To put things in perspective, Wirth asked rhetorically, "How do you go to your board, how do you go to your shareholders and say 'we're going to spend billions of dollars on new capacity in a market that is, you know, the policy is taking you in the other direction."
Wirth's comments come as the U.S. grapples with soaring gasoline prices that were already climbing in 2021 amid increased demand and reduced supply and were exacerbated by Western sanctions imposed on Russia, a major oil exporter, for its invasion of Ukraine.
The average price for a gallon of gasoline in the U.S. hit a fresh record high of $4.761 on Friday, according to the latest data from AAA. While U.S. crude closed at $118.87 per barrel on Friday.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| USO | UNITED STATES OIL FUND L.P. | 84.05 | +0.71 | +0.85% |
| UGA | UNITED STATES GASOLINE FUND LP PARTNERSHIP UNITS | 71.01 | +0.34 | +0.47% |
The Biden administration has sought to ease the rising prices by releasing a record 180 million barrels from the already-depleated Strategic Petroleum Reserve over six months starting in March, and by urging both foreign and domestic producers to increase output.
Wirth said that is just what the industry is doing.
"We raised our Permian [Basin] production growth outlook to 15% this year," he said. "So the narrative you hear that the industry is not growing production is not true. We are growing production and our industry is growing production."
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Two and a half years away from a change in this terrible policy.
Yea Vic, the CEO of an oil company is working to tell USA LL the TRUTH, as his company probably doubled their multi billion dollar first quarter profits, y oh y do you think he might Lie….?
Big oil salesman. Sounds like a used car salesman.
They are afraid to refine yet they are...
Sounds like you've been listening to Joe Biden. He also said he wanted to end US oil production.
Those are short term profits that are not sustainable. Oil has a history of boom/bust cycles. There's no doubt the regulatory environment has become much more antagonistic toward oil producers. Government really has adopted a policy position to eliminate oil the same as coal. There isn't anything that suggests investments in oil production will pay off. Governments have committed themselves to ensuring that oil has no future.
But we can't just pull the plug. Transitioning away from oil will require decades simply because we can't produce and deploy alternatives that quickly. The United States produces and imports about 10 million vehicles a year. So, it will require at least a decade to transition to EVs unless we grossly distort the market which will only create bigger problems in the future. The ramifications of a transition to EVs will extend far beyond oil.
Oil companies will need to transition to energy companies to remain in business. And those oil profits will be needed to transition to alternatives. The political hyperbole is focusing attention on profits made by business units, such as refineries, but that doesn't necessarily translate to overall corporate profit.
doesn't necessarily translate to overall corporate profit.
Really….? Do tell, what other entities do share in these multi BILLION DOLLAR QUARTER PROFITS?
Aren't many of the US refineries, owned independently, not by the big oil companies?
I am the one who inquired
The article is focused more on European investments in alternative energy. The oil majors are creating subsidiaries that are pursuing market share in the alternative energy markets.
Planning by oil companies is performed by technical people rather than politicians. The oil companies are motivated by a sustainable future for their business rather than winning the next election.
PLEASE….do tell how
The oil companies are motivated by a sustainable future for their business rather than winning the next election.
.
How they can be separable ?
Simple buy off Republicans for benefits to keep the oil and gas coming now. Buy off the Democrats for tax breaks to ensure Green energy development.
Either way they win, either long term or short term.
(NYSE: CVX) today reported earnings of $6.3 billion ($3.22 per share - diluted) for first quarter 2022, compared with $1.4 billion ($0.72 per share - diluted) in first quarter 2021. Included in the current quarter were pension settlement costs of $66 million.
If you ask me, they are just making up loses they had during the pandemic.
They could care less about us or the government. The government is just a scapegoat.
didn’t know 1.4 BILLION profit was a loss $ loss. Oh the humanity
Joe Biden's government is over 30 Trillion in debt.
Why did you count through Sept of this year?
It is a November 2020 article.............and I guess some would rather we hadn't spent about $3Trillion on fighting Covid and supplying vaccines as well as some everyday reliefs.
How bout some would rather know the actual statistics that Vic is distorting
Which stats?
Excuses. But trump had to......
Again, why count through Sept 2022 to calculate the debt under Trump?
Which stats?
the ones Vic implied to be solely seen as Biden’s 30 TRILLION $ debt, and many will wrongly infer that Trump had not any contribution, cause inference inferred leads to implications implied
I've never thought of a balance sheet or ledger as stats, but Ok.
Please give NT's more credit than that. We all know that total federal debt climbs under each administration.
If you say so.
Unfortunately for the American people. But not everyone makes it a campaign promise:
Notice, how I chose to leave in the final bullet point. Cause I’m about FULL CONTEXT, something rarely applied by some
I wasn't foolish enough to believe. Over half the federal expenditures go to entitlements. Inflation will make our cost of servicing our debt higher. Of course the money won't be worth as much. Maybe we can inflate our way out of debt ;>)
The sky's the limit.
That steaming pile of shit fucks up everything it touches.
Your belief in a campaign promise has nothing whatsoever to do with the fact that the promise was made and the reverse was done.
To a balloon boy in a plastic Bubble Boy wrap, served with halopenois peppers and broken chips off the engine block of Ponches thrashed and crashed Harley a Davidson in the bunched, up like under wear I wore an over coated twice trench over coat , under my normal wears, n tearz, that keep crying out four more years than some could count
You mean Brandon? Yes he is the human fuck up machine. Thank you for finally stating it.
So we can hold Brandon accountable for not "ending Covid" right? He made the promise; and Covid is still around. There have been more deaths under his watch than Trump's.
He also stated "Any responsible for so many Covid deaths should not remain President". Yet, Brandon hasn't resigned.
Of course we can hold Biden (don't be childish) accountable for not fulfilling a campaign promise. That is different from blaming him for the ongoing COVID-19 infections and variants. Do you see the difference?
If one makes a campaign promise that is impossible or near impossible they should be held accountable. One then looks at the actions to see if they helped or hurt the cause and then make an informed assessment of blame (and/or praise).
So, now, back to my example. What actions did Trump take to eliminate the national debt and were they effective? Trump is accountable for his campaign promise but how much is he to blame for the continuing growth of the national debt under his watch?
These clowns botched the “great transition” as badly as they botched afghanistan. Battery technology still isn’t where it needs to be. The grid has not been upgraded, in fact several states are saying rolling blackouts this summer are likely. And there is a major lack of charging stations. What they want us to transition to isn’t ready. And what are truckers supposed to transition to? Meanwhile, instead of producing oil here, they want it produced halfway around the world so machinery with one of the largest carbon footprints can ship it here. Makes perfect sense /s/.
why don’t they let battery tech advance while they update the grid and add power plants. Set money aside and start planning for charging stations because we’ll need as many of them as we have gas stations. Why don’t they try to make the transition as painless as possible? I don’t think they give a damn. Well, they will pay for their backassward ways come election time.
Because in our divisive political environment parties have to act while they momentarily have the power to force through legislation. Thus they offer half-baked schemes that are intentionally NOT designed for a sensible, incremental deployment with self-correcting measures.
Well, it’s going to cost them dearly in the midterms and hopefully beyond.
I think pretty much everyone is aware that the party in power typically loses in the midterms and that the party in power during a poor economy rarely wins elections.
So, yeah, Gazoo the Ds are clearly set to lose in the midterms.
But the loss is not because the Ds offer half-baked schemes and the Rs offer sensible, incremental deployment with self-correcting mechanisms. It is mostly because of fundamentals: party in power and poor economy.
And even if Biden were a popular PotUS (he is not), I would expect the Ds to lose in these midterms because of said fundamentals.
“But the loss is not because the Ds offer half-baked schemes”
then what would you call the shit show that has been biden and dem policies? Calling their policies half-baked schemes is being way to nice.
I just explained this to you. You are asking a question that I preemptively addressed.
hint: fundamentals
yeah, i’m aware of the “fundamentals”. But i think the dems “half-baked” schemes add fuel to the “fundamentals”.
Yes the Ds have not done anything to help them out of their fundamentals disadvantage. But even if they had done well, the economy + party-in-power would very likely still cause them to lose in the midterms.
The economy, by the way, is the major fundamental here.
Nothing is going to change here. The USA is not likely to abandon a move to renewables and encourage companies to invest in new refineries. Your article gave a fine timeline: this reduction has been going on since the 1970s. Yet you over-simplify and just blame Biden (whose policies will not have any effect for years).
What move?
That's like people abandoning their move to space travel.
Yet you over-simplify and just blame Biden (whose policies will not have any effect for years).
Joe Biden is directly responsible for the high gas prices and inflation. It's called POLICIES!!!!!
What are these policies?
Ha. Blaming the keystone pipeline is comical. You cannot blame something that was never in operation and the profits would have gone to Canada...
If ifs and buts were candy and nuts.
There was a time people thought enough is enough. Why republicans all the sudden think every thing should be tax free, it is nuts.
So they are pissed someone talked about taking away their subsidies?
Why not, they said they won't do it here. I would say it is places like OPEC that keep the price high. Oil is traded worldwide.
methane fee
Did it happen?
So what is wrong with having companies disclose what they are doing? And if the energy companies are already moving in that direction, what would it hurt?
Most of this just still sounds like, well I won't do anything because Biden said something...Sure.
You are unaware that the USA is moving towards renewable energy?
What I see is simplistic partisanship that ignores all the factors that go into the increased price at the pump and the increased costs at each level of the supply chain and blindly (and stupidly) blame it ALL on the PotUS.
I do. I'm interested in the interim. Punishing people to make them buy electric cars that they can't afford will be counterproductive. You'll see that come November.
What I see is simplistic partisanship
That's what I see too.
Nobody is going to invest billions to develop oil production under this enemy of fossil fuels.
It is going to be a LONG, LONG, LONG time before we have renewable energy.
Nobody is being forced to buy electric cars. Another ridiculous conspiracy theory.
Just think for a second, not only is that unconstitutional, it is wildly impractical.
Brilliant
So in other words you are with the oil companies and want a president that will give them free reign to do whatever they want.
Why in other words. it's simpler to follow if you use Vic's own words.
BULLSHIT! That's what they want.
Just think for a second, not only is that unconstitutional, it is wildly impractical.
What is?
You would think someone would take the hint that they are on ignore, but no.
So finally you admit the truth. The oil companies are the enemy.
If he's on ignore, how can you see his comments?
I can see his name and a comment addressed to me. Just not the content.
Ha. I think they are a necessity that takes advantage.
Okay, Vic, you move from @1.4.6 ☞ "Punishing people to make them buy electric cars that they can't afford will be counterproductive." to "that is what they want".
Yes, the administration wants the USA to move towards renewable energy. This is a long-term goal (decades). Now, BULLSHIT-crier, back up your utter nonsense declaration that the administration is "punishing people to make them buy electric cars that they can't afford". Let me guess, another conspiracy theory that claims the administration has intentionally caused prices at the pump to double so as to force consumers to buy electric vehicles.
The only truth in that conspiracy theory is that higher gasoline prices will encourage a move towards renewable. Nothing new there. But you, I presume, go to the next level and declare that the current prices at the pump are deliberate to force the entire nation to move NOW, all at once, to electric vehicles. Ridiculous.
I have to break every post down for you? Watch, Vic:
Now let's combine the first sentence with the third to form a single sentence:
Just think for a second, not only is forcing everyone to buy electric cars unconstitutional, it is wildly impractical.
Do you understand that it is unconstitutional for the federal government to force a consumer to buy an electric vehicle? If not, do some research.
Everyone going to electric vehicles now (instead of this evolving over time) is impractical because a) we do not have enough electric vehicles and b) our infrastructure is woefully inadequate to support that demand.
One would think if one wants to truly ignore someone else, they would simply just do it.
It speaks to control I suppose, a problem with the inability to control what others can and can’t do.
An interesting psychological quirk to say the least.
I have said that before. Change on something like this will take decades, if not half a century or more.
Meanwhile countries like China, Russia and India are laughing their asses off at us.
Of course. People are often ridiculous in their conspiracy theories.
Also, the oil companies in the USA have not built refineries for decades. The move to renewables spans multiple administrations. Biden is likely a four-year blip. Oil companies are not going to make changes that they dislike simply because of Biden (who almost certainly will not be reelected).
The change in oil company behavior is based on the worldwide movement towards renewables and away from fossil fuel energy. Blaming this on Biden is beyond naïve.
I'm sorry that I was slow on taking the hint, but I didn't realize that I was on your ignore list. NT should make that available to all so I can see who has put me on ignore, then mistakes wouldn't happen.
I read where Chevron acquired a refinery in CA in 2019. I am guessing they purchased one already in operation.
Have you observed that first hand ?
There is only one reason Biden's handlers continue on with these horrendous policies.
They want them despite the suffering.
Because Vic, just as you, attempt deception via decisive divisive wording, implied, while you state NTease can differentiate, while fully knowledgeable, that is NOT the case, wish to TRI another….maybe this time, with a tad more Conviction….
China is still killing Americans, this time with Fentanyl.
Meh, we'll replace them with third world migrants.
Yep and still with the China virus.
What is Biden’s China virus death count up to now?
You just deflected from all the points I made and simply made an emotional declaration.
The Biden administration is not trying to force everyone to move to electric vehicles and it is not in the short term.
The administration (and this was true of prior administrations and will be true of future administrations) will encourage consumers to choose renewable energy over fossil fuel energy and this will be a gradual process for practical reasons. I gave you two reasons but will add a third:
Please tell Susan Rice.
Deflection.
She's the one behind the curtain.
Damn right she is and she’s not alone.
That's some epic gaslighting there Vic.
Raven Petroleum has had a refinery in the works in SW Texas since 2016 [note that was during the Obama Administration]. The big hold up is actually in fighting with the COUNTY.
Raven Petroleum threatens to pull out of Duval County (lmtonline.com)
Fail.
And we had some major drilling and fracking here during the Obama years. I remember him bragging about it:
That man knew how to get his hands dirty.
another thing is they are likely not going to spend the money on some existing plants to keep up with emmission and ecological standards . they can actually buy it cheaper elsewhere already refined , than spend that money .
He admits they haven't built a refinery sense the 70's. They are making money and could afford to do so, they just don't want to.
Profit over anything.
Another thing, if they are not going to refine, why need the tar sands pipelines.
Stop asking sensible questions
Where would you like to see some new refineries built? How much would you invest?
There are undoubtably a lot of NIMBY’s here on NT.
where did i say they would STOP refining?
they will likely keep just enough refining capability in country to satisfy the stratigic reserve , that one that MIGHT last a week if tapped into only to be replenished at a higher cost . thing is they wont be paying for the upgrades needed to keep those older refineries on line , especially if the industry gets nationalized , the cost will be on the feds and taxpayers then .
Im looking into bying a mule will name him braydon ......
Indeed, I surprised that they aren’t happy with dropping US refinement capacity.
They could pay for the upgrades, they just don't want to.
Omg! They made 5 billion instead of 6....
He even admits in this article it is all for him and his stock holders.
So they completely failed to take your needs into consideration, shocking!
neither do they have to .
Yet because of their choices we are having people blame the government, Biden, whatever else instead of them.
"they' can only refine what is avalable to them, government drilling policy has part to do with it , another and larger part of it is oil futures and speculators those 2 things drive up the price of the raw material , if that raw material costs more , the price of the finished product goes up as well. and those billions in profits ? thats not just in this country , that is what they make WORLDWIDE , every country that uses petrol . they could stop selling totally in this country and still make aprofit from what they make world wide .
i have seen $5-6 a gal gas before ... In 1985 in Europe with the exchange rates . we are not really being screwwed on price , YET.
Imo there is plenty available to them.
That may be , but their bean counters are the ones that will figure in all the things that will effect if it is a loss or a profit , if they say its a loss due to cost because of speculation or government regs , it likely wont be done . And that is a simple fact of life .
I guess my point being, they have the means and the capability and nothing is holding them back except themselves.
Kind of hypocritical to say they have to be penny pinchers when they are making whirlwind profit.
What has been the refineries ROI over the last ten years?
and they are under NO obligation to do so. even if they have the means and capability , i if the projections say it will be a money loser , they certainly wont be doing anything like that to appease someone that they dont even know ..
What? 'Has said it wants to do'...
So you are going to tell me that these oil companies are not going to invest because Biden said something?
Do you really think Biden can eliminate oil?
Yes, of course! Do you not understand risk? Or money? I'm always amazed how juvenile people can be when they are dealing with other people's money.
Would you take your life savings and to try and build an addition to your house if the village you live in has spent decades making the building/use of the addition almost impossible and your Mayor has send no new additions will be built under his watch?
? I am always amazed you all will take an oil CEO's take on every thing with no questions asked.
People have been trying to find ways to get away from oil for decades. This is nothing new.
And it is not dealing with other people's money when we are the ones paying for it. The end people, the consumer.
I notice you didn't answer the question. So you understand it would be foolish to risk your money, but still expect others to do so.
ways amazed you all will take an oil CEO's take
Where is he wrong? You literally cite his argument in the next line, while substituting people for "government"
People have been trying to find ways to get away from oil for decades.
Correct. Joe Biden and the democrats have been making it very hard to produce oil for decades. That's why a refinery in this country for decades.
d it is not dealing with other people's money when we are the ones paying for it. The end people, the consumer.
Do you not understand how corporations are or how they work?
The WPost reported that five refineries have shut down in the United States in the past two years, reducing the nation’s refining capacity by about 5 percent and eliminating more than 1 million barrels of fuel per day from the market. Last month I read that a large, Houston Refinery (1/4 million barrels per day) will close next year.
I understand plenty and am taken going to take the word of an oil CEO that admits he only wants profit for himself and his stockholders.
Oil companies have been dealing with risk ever since they first started oil exploration. Risk is not a new thing.
Amazing the lengths taken to rationalize rations of LIES, cause no disguise, just the ole fall back, Y should one believe their own LYING EYES
Like most things certain posters say.
Then WHY did Chevron invest 47.1 MILLION in oil leases in 2021?
Because there is a global market for oil regardless of where its refined?
You really think he could do it? What is he going to do, outlaw gasoline? He can say whatever he wants, doesn't mean it will happen.
Then Sean claiming that 'of course oil companies are not going to invest because Biden said something' is just more 'blame Biden' bullshit . Thanks.
Your welcome. I think that Sean was looking at the absence of investment in new refineries and your looking at investment in well exploration.
As well as Biden’s promise and I quote:
I guarantee you, we’re going to end fossil fuel
Unquote.
There it is .....
Well, they MUST have SOME idea where the fuck they're going to transport all that crude oil to be refined before they invested 47.1 MILLION in leases.
Why, there is little doubt that there will be refinery capacity in the world. There are newer and larger refineries in India, South Korea, UAE, Singapore, Saudi Arabia, Taiwan, etc..
That makes NO sense. Why invest in drilling in and around the US and then go to the expense of transporting crude halfway around the world? That would put a major dent in their profit margin. Russia if finding that out right now.
Exactly, call dirty energy investors crazy.
I know, why would they think that they can make a profit on oil pumped out of our Gulf sold to a refinery in the Mideast?
Say what?
There you are with that 'exactly = not at all BS. Devolution.
BTW, that was a strawman too.
Another strawman.
Oh and BTW, most of the countries that you cited are in Asia, NOT the Middle East.
What part of my statement don't you understand?
did the math for this discussed federal gas tax holiday 18.4 cents a gal , average fillup for me is about 6 gals , i will save a whopping 1.10......and the change fro E-10 to E-15 that the president authorized still is a joke , i will be running priemium non ethanol thank you very much .
Yep, a tax holiday .... even less money to maintain and repair our already crumbling infrastructure.
Great idea ....
Premium is all I run in my gas powered tools. Ethanol in gas is the bane of reliable operation of those tools.
Gums up to those carbs
A guy in DMR told us that you should not use ethanol in boats. The raising of ethanol is harmful to the motor.
i wont use ethanol in anything , small engine or large , boats and planes, those places they fuel usually wont even sell ethanol mixed gas , wanna see a lawn mower really take off? run some avgas through it ..... but mix the av gas with priemium in 2 pre and 1 av . av gas still has some lead in it , just enough so it cant be called unleaded . DONT run that mix in your car, it will chernoble or 3 mile island .
, the policy of our government is to reduce deman
But it's not Biden's fault!