Lautenberg Right on Refineries....

by: Nick Lento

Tue May 27, 2008 at 07:15:49 PM EDT

As I recall, Lautenberg said something like it might be a good idea and it needed to be studied. He said a bit more that I'll mention below.

Andrews was straight out for it and Cresitello was ready to build one "today" by implementing a crash program of sorts.

If all you knew was what the questioner asked and what the three responses were, you might have thought that Lautenberg's answer was weak, or less "active".

Well, check this recent NYT story out....  

After last year's stellar profits, American refiners are going through a traumatic period. In a time of record gasoline prices, some of them actually lost money in the first quarter, and for virtually all refiners, profits are down sharply.

Experts say the refiners are caught in a double bind. The price of their raw material, oil, is rising because of strong global demand. At the same time, consumption of gasoline in the United States is falling as a result of slower economic growth and consumer efforts to conserve.

However much the companies would like to raise gasoline prices enough to pass along the full increases in oil, analysts say they have been unable to do it. Oil prices doubled in the past year, while wholesale gasoline prices rose a mere 39 percent.

"Refiners are having a terrible time," said Lawrence J. Goldstein, an economist at the Energy Policy Research Foundation.

Here's more...

In response to falling gasoline demand and rising costs, refiners have cut their production rates. Refining utilization rates, for example, slumped to a low of 81.4 percent in the second week of April, compared with 90.4 percent at the same time last year. Earlier this month, refineries were running at 85 percent of their capacity.

So, as it turns out, the response that Frank Lautenberg gave was actually the most sensible of the three.    He also said that building additional refineries would do nothing for the crisis we are suffering today....the implication being that his two opponents were milking the issue to appeal/pander to the distress/disgust/anger that many of us feel whenever we top off our tanks.

I dare say, anyone running for this level of office should have known the status of our refineries in at least as much detail as is contained in the recent NYT article.  

In any event, chalk one up for Lautenberg's instinctive good judgment and common sense.

PS

We need to get back to Jimmy Carter's take on the issue of energy....he used the phrase "the moral equivalent of war".   He was all for truly major changes in the way we "produce" and consume energy.  If we had stuck to his energy policies we would be living in a different world today.

Carter caught hell for giving the following speech....but, it's clear now that he was right....and that the nation blundered badly when it put Reagan in office.   Carter wasn't the loser; we were.

http://www.americanrhetoric.co...