Oil Bros - why can't the US refine sweet crude & would diesel export ban even lower price?

Definitely need to repeal any EPA/Carbon Credit type regulations that increases costs of building a new refinery as well as fastracking any air pollution permitting and evironmental reviews. The real problem is that O&G companies don't want to invest billions of dollars and years of planning and construction for a project that might get shut down in a few years when another cheating democrat is in charge and can change the regulations with a stroke of a pen. I'm hopeful after the dems get waxed in the midterms that the wallets might open up more for O&G/Petrochemical capital projects, which have been at a standstill since the tarriffs hit.

First, Yes, the diesel export ban would lower the price of diesel in the US because we would have more supply and the same demand.

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US produces mostly light, sweet crude now but all refineries are set up for Venezuelan/Canadian heavy crude.

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This is not true. We have a lot of refineries set up that way but not close to “all”.

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Also most fuel is consumed on the coastlines cities, but mostly produced and refined in the nation's interior.

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This is irrelevant.

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Would Jones act elimimate red tape to build new refineries?

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If you mean, would the elimination of the Jones Act help get refineries built, the answer is not materially. However, I believe the Jones Act should be eliminated or greatly modified.

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And would Uncle Sam be able to, I don't know, not add $500B to the defense budget and instead take a fraction of that and subsidize energy inftsructure expansion in the US?

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I have mixed feelings about the defense budget. I want a much stronger military but believe it could be had for even less money than we currently spend.

I think your idea of the federal government subsidizing refining is a horrible one. The reason refineries are not being built very much is because of regulations that choke them out. The bill in the Senate right now is a good start to fixing that.

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First, Yes, the diesel export ban would lower the price of diesel in the US because we would have more supply and the same demand.

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Not exactly, because it's not as straight-forward as that. From a post I made last week:

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TL;DR version - All of this would mean a quick drop in diesel prices domestically, but then spikes on the East and West Coasts. As we import a lot of our goods, the jump in international diesel prices would mean an increase on the prices of imports across the board, likely being greater than any savings we saw from increasing the domestic supply of diesel.

For the more in-depth explanation...

The East Coast (PADD 1) has to bring in ~80%-85% of its diesel from outside its region. While the majority of that comes from domestic transport, around 20% of it comes from international sources because those domestic transport avenues run around 100% capacity 24/7/365 (looking at you, Colonial). This is not only from lack of expanding transport paths (new pipelines, expanding refineries, etc) but the actual shrinking of them because of green politics.

We could just run more tanker ships, but then that runs into problems from The Jones Act. The tl;dr on it is that it mandates that any cargo shipped between two U.S. ports must be carried on ships that are built, owned, flagged, and crewed by U.S. citizens. The problem here is there is such a shortage of qualified ships and crew that it's already cheaper for PADD 1 to have imports come in via tanker from Europe than it is for it to come via tankers from PADD 3 (the Gulf Coast).

PADD 5, the West Coast, imports roughly 60%-65% of its crude oil from the international market (read: Northern Asia and the Middle East) because there are only a couple of very small (relative to demand) pipelines which run from any other PADD to PADD 5. Calling the output from those pipelines "a trickle" could be considered an exaggeration. In essence, PADD 5 is a fuel island. Some of this is green politics, some of this is the reality of the logistical headaches of running pipelines through the Rockies.

As an interesting footnote, Arizona is in a unique position where part of it is fed by the extreme end of PADD 3 (from Texas) while the other part is fed from the extreme end of PADD 5 (California). A diesel ban would likely isolate much of that state as demand from the other, larger states would take precedent.

The US produces ~20% of the diesel on the international market. Suddenly removing that from global trade is going to seriously frick a lot of countries to the point where they will gladly frick us back on the cost to us to import diesel from them under waivers, the cost of increased imports of goods (because those are going to rise and we import a shitload of goods) or both.

To look at a different aspect, ~50% of US storage for finished diesel is in PADD 3. We would see a quick drop in prices domestically but all of the other regions would see those prices spike back up shortly thereafter due to the lack of available storage and that so much of that transport and storage infrastructure is currently maxed or nearly so that we have to rely on crude imports for certain regions.

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Wrong.

There's only one US refinery that can handle Venezuelan crude and that's the Chevron refinery in Pascagoula.

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Correct

Side note:
This board really needs an educational lesson on crude oils.

Politicians.

They have refused to approve any refinery projects since the last one was built which was Marathon Garyville, LA in 1975. There has been expansion projects but no new refineries.

If we had more that can refine sweet crude which is what the US produces, what happens overseas for gasoline would not matter.

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There's only one US refinery that can handle Venezuelan crude and that's the Chevron refinery in Pascagoula.

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Which is looking to expand because of it.

I thought Citgo was refining Venezuelan crude as well.

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There's only one US refinery that can handle Venezuelan crude and that's the Chevron refinery in Pascagoula.

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What about this?

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Valero was the largest US recipient of Venezuelan crude in July, with a total of 282,000 b/d at three refineries — its 290,000 b/d Corpus Christi and 385,000 b/d Port Arthur refineries in Texas, and its 215,000 b/d St Charles plant in Louisiana, EIA data show.

Citgo took the second-largest amount of Venezuelan crude in July with 112,000 b/d, while PBF Energy was third at 84,000 b/d.

Other US refiners and trading companies that took Venezuelan crude in July included Phillips 66, Chevron, ExxonMobil, Marathon Petroleum, Pemex-owned Deer Park Refining, and Atlantic Trading and Marketing, according to the EIA data.

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There's only one US refinery that can handle Venezuelan crude and that's the Chevron refinery in Pascagoula.

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Citgo in Sulphur refined almost exclusively Venezuelan crude for decades.

For what in return orange man?