quote:

Originally posted by Zacsquatch:
Why the fuck are we exporting it when we still import it?

I've read sometime ago that US refineries are built for refining heavier oils from Canada (oil sands), Mexico and Venezuela (heavy tar-like) whereas US shale oil are "light & sweet", almost diesel like, so more cost effective to export it to countries with refineries built for that.

Will most US refineries eventually be retrofitted to handle shale oil? I'd guess yes.

quote:

Originally posted by Zacsquatch:
Why the fuck are we exporting it when we still import it?

I'll give you two examples why:

I'll start with Alaska since we're both former residents. The prohibition on exporting crude oil affected Alaska most as every drop not refined for Alaska use was loaded on tankers. Due to the export ban, it was sold to West Coast refineries at a discount which means Alaska's permanent fund would've been even larger in a true free market situation where West Coast refineries had to bid against Asia.

West Texas Intermediate (WTI) Crude Oil. It's a light crude oil with specific gravity near diesel and contains a high percentage of light ends. Gulf Coast refineries were originally set-up to run light crudes like WTI, but in the 90s they shifted to heavier crudes from Venezuela and Mexico to keep gasoline prices down and the Permian Basin was depleting. Generally, when a refinery is set-up to run heavy crudes it'll shit itself on light crudes and when a refinery setup to run on light crudes will shit itself on heavy crudes. In other words, the largest refining cluster in North America is already set-up to produce inexpensive gasoline. It got even more interesting when the Canadian tar sands crudes came on-line changing the market to the point WTI began trading for less money than Brent. Now, the Delaware basin has been discovered under the Permian basin and WTI is making a comeback. Right now it's a win win as consumers get cheap gasoline and producers get to make money while they build out the Delaware Basin. The free market will determine whether refineries are reconfigured to process WTI or if we should continue to export it.

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Ego is the anesthesia that deadens the pain of stupidity

DISCLAIMER: These are the author's own personal views and do not represent the views of the author's employer.

I don't want to come across like I'm complaining or anything..., ya know, cause I'm from Florida and it's such a piddly amount, but gas is up another 10¢ here as of today.