Oil Industry starts pre-emptive bullshit barrage to justify summer price gouging....

[marmar]

from Bloomberg:



Crude Oil Rises More Than $3 on U.S. Gasoline Stockpile Decline

By Mark Shenk

April 2 (Bloomberg) -- Crude oil rose more than $3 a barrel in New York after an Energy Department report showed that U.S. gasoline stockpiles dropped for a third week.

Gasoline inventories fell 4.53 million barrels to 224.7 million barrels in the week ended March 28, the report showed. It was the biggest decline since August. Refineries increased operating rates for the first time in four weeks. Prices also rose because the dollar dropped against the euro, bolstering the appeal of commodities as a hedge against inflation.

``The robust supply cushion for gasoline appears to be vanishing before our eyes,'' said John Kilduff, vice president of risk management at MF Global Ltd. in New York.

Crude oil for May delivery rose $3.15, or 3.1 percent, to $104.13 a barrel at 2:02 p.m. on the New York Mercantile Exchange. Prices are up 58 percent from a year ago.

......(snip)......

Gasoline Inventories

Gasoline inventories were forecast to decline 2.75 million barrels, according to the median of 15 responses in a Bloomberg News survey.

``The gasoline drop was a real eye-opener,'' said Rick Mueller, director of oil practice at Energy Security Analysis Inc. in Wakefield, Massachusetts. ``Supplies are falling when we aren't even close to the driving season. We should be building stocks ahead of the driving season, not seeing them drop.''

U.S. gasoline demand increases during the summer, when Americans take to the highways for vacations. The peak- consumption period lasts from the Memorial Day weekend in late May to Labor Day in early September. ......(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=atBLxUhw6e4s&refer=home

[DJ13]

1. Gas refining is the ONLY business I know of ...........

........that can regularly increase prices by simply not producing.

Never short enough to trigger any real shortage, just the appearance of a reduced supply is all it takes.

[Arctic Dave]

2. A drop in supply = Bigger profits

This is the TRUE reason we haven't a refinery built in the states in decades. Not because of lame assed reason like NIMBY or too many regulations.

[Hydra]

3. Controlled shortage

Right out of Cheney's playbook.

Can we get off oil and biofuel(which they'll do the same with) yet???

[durablend]

4. And yet the right will harp

"WE NEED TO DRILL DRILL DRILL MORE!!!!!!"

Maybe we need to drill into some of their skulls to see if there's any life in there (doubtful).

Of course as you've stated, that whole argument of falling supplies goes right out the window when refineries have already admitted (several times) that they're intentionally reducing production to keep the prices up.

[Hydra]

5. Ya, they say drill more

But what that will translate to "spill more."

[marmar]

6. "But what that will translate to "spill more."

You betcha.