re: Oil producers in a ‘dire situation’ and unable to ramp output, says Oxy CEO

Got a world scale pipe plant in Portland texas, run for a month and mothballed the last 3 years.

If EVs are to ever be driven by a majority of people, every state will need 2 new nuke plants. Anything else is pure folly.

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If EVs are to ever be driven by a majority of people, every state will need 2 new nuke plants. Anything else is pure folly.

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If everyone had an EV we would need zero new plants, and we could actually stop having to fire up peaker plants if significant numbers have backfeed chargers.

Isn't nuclear tech tremendously more safer than it was 40 years ago or however long ago they started building plants.

Maybe I should be freaking out like OMlandshark. Apathy for me about growing old and retiring as an OT Baller set in around 2008 maybe a little earlier.

Ross

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streamline nuclear regulations and build nuclear power plants everywhere

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Best post for long term solution. We and French have operated pressurized water nuclear reactors since the 60's with no major issues.

With updated and tech and standardized accepted designs to lessen regulation and stream line approval process. Yes I like one near my house. beats the alternatives like wind(not viable) or coal/gas.

Which one is this? Most of the Texas pipe mills are around Baytown, Bryan, Houston, etc.

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Private capital will flow wherever the the F that it wants to. Bankers are going to lend to whomever falls within their risk appetite.

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It's not 2010 any more.

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I don't even know what "energy independence" means anymore.

All we keep hearing is that oil is a global market. That it doesn't matter WHERE we get our oil from.

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The truth is somewhere in between, as usual. Having strong domestic production/capacity protects you from trade spats or conflict that might cause prices to otherwise rise disproportionately in the US.

For example, if Russia simply said “sorry Americans, we aren’t exporting any more oil to your country” but continued their other exports as normal, we would be fine. We are much more prepared to manage, as another example, an Arab oil embargo against the US today than we were in the 70’s.

But strong domestic production doesn’t insulate you from global price swings. So while we may be fine if Russia’s exports to the US are cut off, that protection doesn’t really apply if all of Russia’s exports are cut off - because you can’t just remove ~10% of the world’s crude oil production without affecting the global market.

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The US imports AND exports oil. That's always been crazy to me. If we are trying to become "energy independent" why are we exporting any oil at all?

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People think of oil as a singular commodity with a global price but that’s not really accurate. Oil varies wildly in composition between various fields/regions. Generally speaking, crude is broadly categorized on two scales: sulfur content (sweet=low sulfur, sour=high sulfur) and density/gravity (light vs. heavy crude). There are also many other factors such as TAN (acidity), but gravity and sulfur content are probably the most important for the sake of this discussion. US crude oils are generally categorized as light/sweet.

Major US refineries are mostly built out with the ability to process heavy, sour crudes. If they only run light crudes, the impact is twofold. First, they can’t utilize their conversion units (crackers, cokers, etc.) to full capacity, so they wind up with unused total capacity. Second, heavy crude generally trades at a discount - so if they only run light crudes they are paying more for feedstock than necessary. Consequently, they supplement with heavier oil from other countries (mostly Canada) to cash in on that discount and fully utilize their conversion units.

Think of it this way - you own a 300,000 bbl/d (nameplate capacity) US refinery and have 2 choices:

Option #1: Process 250,000 bbl/d of US crude at $100/bbl. Produce 250,000 bbl/d of refined products at $114/bbl.
- Input cost: $25MM/day
- Output revenue: $28.5MM/day
- Profit: $3.5MM/day (12% margin)
- 50,000 bbl/d of capacity effectively wasted

Option #2: Process 200,000 bbl/d of US crude at $100/bbl supplemented with 100,000 bbl/d of Canadian crude at $80/bbl. Produce 300,000 bbl/d of refined products at $114/bbl.
- Input cost: $28MM/day
- Output revenue: $34.2MM/day
- Profit: $6.2MM/day (18% margin)
- No capacity wasted

The numbers are mostly hypothetical but you get the idea. The end result of option #2 is a net positive for the US, even if we are producing more oil than we consume (e.g. “energy independent”), because the US is already exporting both crude oil and refined products. So that other 50,000 bbl/d of light/sweet American crude that didn’t get processed at the US refinery still sells elsewhere for $100/bbl. On top of that, a US refinery gets the benefit of buying discounted foreign (Canadian in this example) crude, upgrading it, and selling the finished product globally at the normal market price.

Ok. I don't believe her.

Did you see how quickly the climate and race hustlers jumped in when Ukraine was taking over the news? They immediately starting pumping out stories.