Originally posted by 99blacksesport: Issues like what? the lack of refineries??? If this is the main part of the problem, which it seems to be acording to this article: Linky Why isnt the government stepping in and giving money to refineries to build new ones or to get their old ones up to production levels that will support us?
i have three little letters for you, e.p.a. they throw a hissy fit anytime we want to get a new refinery going. tapping the strategic reserves is not going to solve the problem. what we have here is a refining and distribution problem.
We have a winner; refining capacity has been an issue FAR longer than most any other.
Tapping the SOR will help to alleviate the fact that the gulf provides approximately 25% of our daily crude consumption. The storm affected EVERY level of production, from supply, to refinement, to distribution. The eastern seaboard, up from the New Orleans area of the U.S., will probably see the largest percentage price increases. This is due to the fact that the major pipeline that runs some 2500 miles up from the New Orleans area to the Northeast corridor is pretty much offline (distribution). Refineries are waterlogged and offline and there is serious concern about petrochemical pollution producing potentially disastrous environmental problems for the affected areas, but it's too early to tell just yet, we'll know more over the next several days. Initial reports of many of the rigs in the Gulf of Mexico actually look better than was expected, some of the suppliers are actually coming back online, especially those with rigs in the southern gulf regions, however there are a number of other providers with rigs in the mid-northern gulf regions that are worse off and are currently offline. IIRC we're running about 10 percent of our usual 3.4 million barrels/day of crude out of the gulf right now from a supply perspective at this moment. This number should rise considerably over the next couple of weeks as the rigs come back online. Then, as others have said, refineries come into play, followed by distribution. There is potentially serious damage to both the distribution channel as well as the refineries, we'll have to wait and see.
The hidden danger that we're all going to see in a couple of months is the fact that we also supply some 10 billion cubic feet (or is it million? billion IIRC) of natural gas from the gulf daily that is also largely offline, and this is an even larger dent as a percentage (25% of crude comes from the gulf, I believe it's around 50% of CNG that is gulf centric) of our total supply than crude oil, and winter will be here in a few months. Only time will tell...
