OT: Oil in the US. A true discussion, don’t do political ********.

[TaleofTwoDogs]

To be clear, small ships were an indirect effect of the Jones Act, as the Jones Act did not specifically mandate the size of the vessel only that they be owed, operated and crewed by Americans. The Act applies to marine transport between US ports only. Today, the smaller vessels are the direct result of the lack of ship yard capacity to build the larger more cost efficient supertankers. The Jones Act was a 100% protectionist legislation that is over 100 years old and is obsolete. It was run through Congress by Wesley Jones of Washington which is a huge ship building state in response for the need to build new ships after the losses suffered in World War I. Ultimately, the maritime industry benefited while other American businesses and the buying public suffered. The perfect special interest legislation.

 

[BoomBoom.sixpack]

To be clear, small ships were an indirect effect of the Jones Act, as the Jones Act did not specifically mandate the size of the vessel only that they be owed, operated and crewed by Americans. The Act applies to marine transport between US ports only. Today, the smaller vessels are the direct result of the lack of ship yard capacity to build the larger more cost efficient supertankers. The Jones Act was a 100% protectionist legislation that is over 100 years old and is obsolete. It was run through Congress by Wesley Jones of Washington which is a huge ship building state in response for the need to build new ships after the losses suffered in World War I. Ultimately, the maritime industry benefited while other American businesses and the buying public suffered. The perfect special interest legislation.

Wait, so nothing is stopping anyone in the US from buying a supertanker from whoever and using it between US ports so long as it's crewed by Americans? So is it that it's just not profitable to do so?

 

[PBDog]

^^Doesn't realize 92% of the things in his home are made in China.** Only about 3% of US consumed crude actually comes from Russia. Some answers are below in a WSJ article. Prolly behind a paywall. So I will paste the meaty stuff...

https://www.wsj.com/articles/why-does-the-u-s-still-buy-russian-oil-11646151935

If the U.S. exports millions of barrels a day from the Gulf Coast, why does it import Russia oil?

The Jones Act, passed a century ago, has effectively limited the size of vessels that are allowed to transport goods between U.S. ports. That has left oil buyers on the West Coast and East Coast effectively unable to get supplies shipped out of the Gulf Coast.

The Gulf Coast, where oil companies shipped out about 3 million barrels a day in December, is connected by pipelines to the Permian Basin of West Texas and New Mexico and Cushing, Okla., the nation’s oil storage hub.

It isn’t profitable for companies to ship oil from that region to the U.S. East and West Coasts by such small ships, so refiners along those coasts, lacking pipeline connections from the Permian and Cushing, mostly import it from overseas.


This stupid *** Jones act is a problem (apologies to Taco.) It's protectionist horseshit for 3 shipyards and kills us. We'd be better off subsidizing the bastards and buying the big tankers from elsewhere.

https://www.grassrootinstitute.org/2021/09/myth-the-jones-act-protects-american-jobs/



Why do U.S. refineries need different varieties of crude?

The U.S. buys Russian oil in part to feed refineries that need different grades of crude with a higher sulfur content to make fuel at top capacities. U.S. refineries were designed decades ago to use heavier grades of crude, often with higher levels of sulfur, when domestic supplies were lower.

In recent years, Russian crude has filled some of the gap around the world left behind by sanctions on Venezuela and Iran, which crippled the flow of that type and similar types of oil from those two countries to refiners in the Gulf Coast and elsewhere.

Refineries don’t “need” it but it makes more money with it. So if this price is right they buy it. If not then they see what’s available and if they can make the recipe align with their pots and pans. With buyers boycotting future RUS contracts this is driving up the cost of all supplies because you can’t get caught with your pants down and nothing to cook in the kitchen because the rent is not going to change.

 

[TaleofTwoDogs]

Wait, so nothing is stopping anyone in the US from buying a supertanker from whoever and using it between US ports so long as it's crewed by Americans? So is it that it's just not profitable to do so?

Sorry, my bad. I inadvertently omitted that with the operation of the ship it also had to be built in a US ship yard.

 

[DesotoCountyDawg]

There would have to be some new revolutionary way to make batteries that we currently don’t have for electric tractors to even be remotely possible. The high horsepower and torque loads that tractors need and use on a daily basis would drain current batteries in just a couple of hours. There are some electric tractors but they are all small and low horsepower.

 

[GloryDawg]

I *think* there tons of reasons for why we buy oil from other countries.


Also as a way to seem more environmentally conscientious.

If it is about the environment does it matter where it comes from? It is still coming so why not use our own where we can control how it is drilled?

 

[Bill Shankly]

The Wall Street Journal has written in support of outsourcing industry for multinational corporate profits (at the cost of weakening US strategic capacity)? You don't say. Shocking.

As US shipping has dwindled, which it has done enormously despite the Jones ACT, that act has caused us a lot of problems. There is NO doubt that we import things that we probably wouldn't if the Jones Act wasn't in place. It's cheaper in some cases to import stuff than it is to ship it from within the country. Sometimes in some places importing is the only option even if we DO produce it here. Oil is a big one. LNG too. Thank God for pipelines......oh wait a minute.

 

[dorndawg]

And they don't want the waste either. Several different waste disposal areas have been shut down or cut back due to local opposition.

In all fairness, I think I'd rather live close to a nuclear plant than a nuclear waste dump. Also, there's the problem of how to warn humans far in the future DON'T 17ing TOUCH THIS. Interesting read: https://www.bbc.com/future/article/20200731-how-to-build-a-nuclear-warning-for-10000-years-time

 

[johnson86-1]

How much do we actually buy from the rooskies? I've seen 3% and 7%, I *think*. I'd have to guess we aren't buying any directly, lately?

But it's not just how much we buy from them that's relevant, it's also how much they sell into markets we buy from, and to a certain extent, how much they sell into markets we don't buy in if that market has buyers that do buy in markets we buy from.

Even if we were buying zero oil from Russia, if Mexico did and Mexican companies stopped buying from Russia because of sanctions and instead bought all of their oil in the same markets we buy from, the impact we feel from price should be basically the same as if we had been the country buying from Russia directly and then stopped.

On the flip side, if we bought a lot from Russia, but there were other buyers buying in the same non-russian markets as us that had no problem taking Russian oil, they could buy Russian oil at a discount, the supply they were buying from other markets we buy in would be freed up and available at just a (presumably) small markup, and there would be almost no impact. Russia would take a slight hit to revenue, we'd pay slightly more for oil, the physical route different oil took to get to refineries would change, but it wouldn't really impact much at all ignoring the logistics.

 

[GloryDawg]

Phase I of the Keystone got oil from Alberta to the oil terminal in Illinois. It started pumping oil in 2010.

Phase II pumped it from Illinois to refineries in Nebraska and Oklahoma. It started pumping 2011.

Phase III pumped it from Nebraska and Oklahoma to Texas. It started pumping 2014.

Phase IV construction stopped. It was going to get it to the gulf coast refineries.

Questions:
So is the entire system shut down or did they just stop the construction of Phase IV?
If the first three are up and running why not finish Phase IV? It was going to pump the oil from Texas to Gulf Coast. It's Canadian oil. Not Russian.

 

[johnson86-1]

Phase I of the Keystone got oil from Alberta to the oil terminal in Illinois. It started pumping oil in 2010.

Phase II pumped it from Illinois to refineries in Nebraska and Oklahoma. It started pumping 2011.

Phase III pumped it from Nebraska and Oklahoma to Texas. It started pumping 2014.

Phase IV construction stopped. It was going to get it to the gulf coast refineries.

Questions:
So is the entire system shut down or did they just stop the construction of Phase IV?
If the first three are up and running why not finish Phase IV? It was going to pump the oil from Texas to Gulf Coast. It's Canadian oil. Not Russian.

The entire system is not shut down. There was a southern leg of the keystone XL project that was completed that ran from refineries in Texas to somewhere in the midwest (maybe illinois?). Pretty sure it is operating and receiving oil from the "original" Keystone pipeline, but I'm not sure if it's operating at full capacity without the extra volume coming from XL. The northern leg of the Keystone XL was going to cross the border, and because of that, it gave the presidency an easy route to terminate it based on "national security concerns". Obama "killed it". Trump resurrected it. Biden "killed it" again, and this time the company trying to do it announced they were abandoning it. They have a pretty decent legal challenge that it was authorized by Congress, but they are apparently cutting their losses. Maybe if we get a Republican President again and they think they can get something approved and built in 4 years they will give it another shot.

That may not be all exactly right, but I think it's pretty close.

 

[DesotoCountyDawg]

Phase IV or the XL pipeline was just creating a shortcut. All the other pipelines are operational.

 

[PooPopsBaldHead]

To be clear, small ships were an indirect effect of the Jones Act, as the Jones Act did not specifically mandate the size of the vessel only that they be owed, operated and crewed by Americans. The Act applies to marine transport between US ports only. Today, the smaller vessels are the direct result of the lack of ship yard capacity to build the larger more cost efficient supertankers. The Jones Act was a 100% protectionist legislation that is over 100 years old and is obsolete. It was run through Congress by Wesley Jones of Washington which is a huge ship building state in response for the need to build new ships after the losses suffered in World War I. Ultimately, the maritime industry benefited while other American businesses and the buying public suffered. The perfect special interest legislation.

Yup. For those who don't understand the Jones act let's imagine it was pushed by someone out of Michigan 100 years ago to protect American made vehicles. "You can buy foreign made cars, but you cannot drive them across state lines. Only American made vehicles may be driven across state lines."

In that world we would all have Ford, GM, or Chrysler cars. No Toyota or Mercedes. American auto manufacturers would not have been pushed to innovate and lower costs in the 70's and 80's by Japanese and German autos. We would be driving 100% American made, expensive, pieces of ****. While at the same time Ford, GM, and Chrysler would be making money hand over fist and workers would be making way more money. It's like the worst parts of socialism and capitalism combined. Again, apologies to Taco.

 

[Bill Shankly]

Pretty much, but we're still talking about hundreds of companies that still compete among themselves for US business.

What's the alternative? Let US shipping be dominated by Chinese firms? Ok, boomer.

It pretty much already is.

 

[aTotal360]

I think it matters to some. Same people will bury their head in the sand about the environmental impact of EVs.

 

[BrunswickDawg]

But that has to be something specific to what Southern Comapny is doing, right? Are they trying a new technology or reactor design?

France can still build reactors. Are our regulatory requirements so insane compared to France's that it triples the cost of a new reactor being built in thte US compared to France? Surely (hopefully) not, right?

I think it's just that complex and long of a process. Vogtle already has 2 operating reactors at the site. Construction began on those in 1976, with the first being completed in 1987 and the second in 1989 and cost $16 billion in todays dollars. In my opinion, Southern Company just wasn't honest about timeframes and costs. Permitting and approval took 4 years and construction started in 2013. If two new reactors are completed in '23, both will have taken a year less than it took to build the first reactor. It was a hard sell by the Southern Company to get approval from the GA Public Service Commission to allow the project, and giving rosy projections has bitten them in the ***.

 

[mcdawg22]

I know it’s locked. But thank you to the informative posters for providing some insight. I learned a lot. I appreciate you guys!