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Oil refineries are making a windfall. Why do they keep closing?

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  1. skybrian
    From the article: [...] [...] [...]

    From the article:

    Five refineries have shutdown in the United States in just the past two years, reducing the nation’s refining capacity by about 5 percent and eliminating more than 1 million barrels of fuel per day from the market, leaving the remaining facilities straining to meet demand. Yet even at this lucrative moment for what’s left of the refining industry, a White House desperate to bring down gas prices is having little success persuading owners to expand operations, and more closures are imminent.


    The profits follow years of heavy losses at many facilities after demand plunged during the pandemic. Unpredictable shifts in oil markets had created a challenging business climate before that. Even at this moment of windfall refinery earnings, when the profit margin on each barrel of oil processed has jumped from a dollar or two a year ago to as much as $18 today, investors are hardly jumping at the opportunity to enter the sector. They fear the profits are short lived. The administration’s environmental priorities — as well as rising public and corporate concern about climate change — would make many refineries obsolete in the not-too-distant future.


    The last major refinery to come online in the United States, in 1977, is the one owned by Marathon Oil in Garyville, La. It is capable of pumping out 578,000 barrels per day. Since it opened, more than half the refineries in the U.S. have closed.


    There is a large refining facility in Houston up for sale right now. [...]

    The problem: Nobody wants to buy it. There has not been a single viable bid.

    In the absence of any offers, LyondellBasell plans to shut its 700-acre operation on the Gulf Coast no later than the end of next year. Quitting the refining business, the company said in a statement, “is the best strategic and financial path forward.”

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