Oil executive (Royal Dutch Shell) responds to outcry - calls on Americans to cut demand

[jpak]

http://www.chron.com/disp/story.mpl/business/4834682.html

With gasoline prices topping $3 nationwide, many U.S. drivers and some lawmakers are accusing oil companies of intentionally keeping pump prices high to increase profits.

But Rob Routs, Royal Dutch Shell's top executive over global refining operations, said the situation the U.S. finds itself in today has been years in the making and has to do more with the country's shortage of refining capacity than any profiteering on the part of oil companies.

Americans, too, must "back off" on their gasoline consumption or energy costs will only keep rising, said Routs, a Dutch native who lives in The Hague and was in The Woodlands on Thursday for a conference. Routs, who also serves on Shell's board, spoke with Chronicle reporter Brett Clanton during a break.

Q: In the first quarter, the major producers of gasoline saw profits from refining operations in the U.S. and abroad grow 50 percent over last year, and the second quarter is also expected to be strong. It would be easy to look at high gas prices and those profit numbers and assume something isn't right. Why shouldn't people do that?

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[liberal N proud]

1. I have a plan that would cut gas consumption by 20%

But no one wants to listen.

All we have to do is move business like manufacturing and white collar work to a 4 day work week vs the 5 day 8 hour week we have now.

We would probably get more accomplished in 4 - 10 hour days than in the 5 - 8 hour days just because there would be fewer interruptions of shift changes and the meeting had to end because it was 5:00 PM

One day a week would cut 20% of the driving from everyones schedules instantly.

What would Mr. Shell think of that?

[gaspee]

2. I think

it's a great idea.

[gaspee]

3. Sounds like he's saying

Dude, if you weren't a crack addict, I couldn't get away with charging you 25 bucks for a little rock. It's your problem, crackhead!

[Nihil]

5. That works for me! (n/t)

[Delphinus]

4. I'm still not sure why they don't build more refineries.

From the article:
Q: Construction is already under way to double the size of the Motiva refinery in Port Arthur, which Shell partly owns. But why hasn't Shell made a final investment decision on the project? What are you waiting on?

A: A final estimate, as simple as that. You wouldn't believe how fast costs are going up these days. Even over the period that we've been studying this thing, the price has gone up. So I want to have a firm estimate in my hand before I make a decision.

One refinery doubled is NOT going to do it.

[Dogmudgeon]

6. To make more money

What better way to drive up demand, make the existing supplies last longer, and not spend the billion-or-so dollars that the average refinery costs?

This is part of the Peak Oil Experience. Big Money has now become Scared Money. And rich people are complaining that the merely affluent are being piggish.

Is it a circus yet?

--p!
The Greatest Show on Earth!

[depakid]

7. Makes no sense to invest in refineries

because they know damn well that the supply isn't there....

[Javaman]

8. I just recently read something regarding this last week on Energybulletin.com

What is at issue is not that the oil industry won't build a new one, it's that because of government regulation there is a colossally high fee involved with building a new one. And all sorts of other costs.

It's cheaper and easier for them to expand existing refineries. According to the article, it's estimated that the oil industry has greatly increased it's refining capability in the last 30 years.

I was one that was alway perplexed as to why a new one wasn't built, as well.

Let me see if I can find the article.
This isn't the one I was looking for but it will give you roughly the same info:

http://www.shns.com/shns/g_index2.cfm?action=detail&pk=REFINERIES-05-22-06

I'm certainly no apologist for the oil bastards, but what this information does tell me, is that will less refineries and more expanded, they can easily control the output from a smaller controlled base of refineries than from a larger base.