>> You seem to miss the point. More oil CANNOT solve the problem. More refining capacity is needed to solve the problem
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GST,
There is no way for refining capacity to have fallen this much lower in a year or two. A year ago there was a huge glut of REFINED gasoline. That could happen only with adequate refining capacity. The fact that supplies are tight now is due entirely to refineries running below capacity because they did not want to buy crude oil at high price. Once it is clear that crude price is staying high, refiners will buy and process enough to meet demand. It is simply impossible to accept that there is a permanent shortage of supply in refined oil.
But the best positive proof that the problem is not shortage of REFINING capacity is the fact that crude price is high. If there was refinery shortage, the crude demand would not go up, and crude price would drop. Why would refiners buy and store crude that they could not process ? The fact is they are buying crude, and more than ever. That is why crude price is up. The minute refinery capacity is reached, crude price will pause and likely drop.
I'm not even an economist, but I can be just as wrong as any of them.
By the way, banks were up again today. Must be banking on a rate drop.
Another thing. What happened to all the money Japan was going to pull from the US market ? Did they ? Or do we still need to worry about that double whammy ?
Amazingly, my acct is up this week. Banks, auto parts, disk drives, machinery, and other sensible sort of investments. I guess only the speculative stocks sold off. Maybe my turn next week. But I think common sense will prevail. After all the bubble is a lot less frothy now, isn't it!
Sarmad |
