I knew something stunk in this insipid article by Howell Raines about how the oil industry is causing the oil spike. One of his big claims was that:
But the oil companies themselves choked supply by closing more than half of their 300 U.S. refineries in the past 25 years
Notice what Raines didn’t say. He didn’t say that oil companies has reduced their refining capacity, just the number of refineries. This is typical — a Michael Moore trick to say something truthful while appearing to say something that’s a lie. And indeed, it is a lie.
Sorry to contradict theology with facts, but U. S. refining capacity actually increased by 11% in the last 23 years.
Stats from DOE Energy Information Administration show refining capacity in 2008 as 17,588 TBD (thousand barrels a day of crude distillation capacity) vs. 15,659 TBD in 1985 (earliest year for which data is on-line).
Yes, in the last 25 years, a lot of small, inefficient plants were shut down.
These shutdowns were more than offset by significant expansion of capacity at larger, more efficient refineries, which can process a much wider range of input (not just “light, sweet” credit). In addition, these larger plants have much more complex secondary refining capacity (e.g. catalytic crackers, reformers, desulfurization units) so that they actually squeeze out much more usable products from each barrel of crude, so that net production capacity has probably increased more than the above stats would indicate. Also, the more complex refineries meet higher standards for product quality (e.g. lead-free, “clean” gasoline) and refinery environment and safety.
As I blog, I flatter myself to think I’m getting a little better at this exercise. Realizing when someone uses a fact (there are fewer refineries) to imply a falsehood (refinery capacity is down).