Congressman Krishnamoorthi’s Absurd Plan To Lower Gasoline Prices – Wirepoints

By: Mark Glennon*

What happens when politicians set out to fix a problem that’s largely their own creation? Double trouble.

Congressman Raja Krishnamoorthi (D-Illinois) has a plan to address high gasoline and diesel prices. It boils down to this: “Sure we intend to destroy oil refineries, but let’s pay them something for a while and force them to keep working for us.”

His proposal appears in a Tuesday Chicago-Sun-Times op-ed headlined, “How Washington can help lower gas prices and save your summer vacation.”

Specifically, his resolution in Congress, as described in his column, calls on President Biden to use the Defense Production Act “to provide technical and financial assistance to restart existing American oil refineries for just long enough to reduce gas prices. Unlike drilling new oil wells, restarting idle refineries could have an impact relatively quickly and without a long-term commitment to more oil production.”

That’s quack demagoguery.

To begin with, you can’t just flip a switch to turn mothballed refineries back on. “It would cost hundreds of millions of dollars for each site, and it would take months.” That’s according to John Auers, a refinery consultant at Turner, Mason & Co., in an interview in Energy Wire.

That sure won’t “save your summer vacation,” as Krishnamoorthi claims. Maybe somebody can ask Krishnamoorthi what future summer he was referring to.

And who’s going to pay for it? Taxpayers, of course. How much? We don’t know, and I can find no estimate from Krishnamoorthi. But at hundreds of millions per site, it’s surely significant.

How much would it reduce gasoline prices at the pump? Again, we have no estimate from Krishnamoorthi, but refinery costs comprise only 15% of gasoline cost – that’s from Krishnamoorthi’s own article. And since refineries would still have to be paid along with taxes to cover reopening costs, we couldn’t expect much in real savings.

The original source of the shortage in refining capacity is largely the consequence of pledges and programs to destroy the industry from the Biden Administration and green progressives in Congress like Krishnamoorthi. Biden promised in his campaign that, if he was elected, “No more subsidies for the fossil fuel industry. No more drilling including offshore. No ability for the oil industry to continue to drill period. It ends.”

The consequences were entirely predictable. While the pandemic and other matters contributed to shutdowns, refinery owners saw no sense in paying to keep them operational or open new ones. As reported by the Washington Post on Monday:

Oil refineries across the country are being retired and converted to other uses as owners balk at making costly upgrades and America’s pivot away from fossil fuels leaves their future uncertain. The downsizing comes despite painfully high gasoline prices and as demand globally ramps up amid sanctions on gasoline and diesel produced in Russia, the third-biggest petroleum refiner in the world, behind the United States and China. Five refineries have shut down 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.

Biden has since backed off in part, trying to jawbone oil companies into more exploration and refineries into reopening.

But what’s that worth when other parts of the Biden Administration persist with their stated intention to kill the industry?

Just last week, White House Climate Envoy John Kerry told an interviewer this: “Energy security worry is driving a lot of the thoughts now that oh, we need more drilling of gas, we need more drilling of oil, we need more coal: No, we don’tWe absolutely don’t, and we have to prevent a false narrative from entering into this.”

Also last week, Energy Secretary Jennifer Granholm said this: “What we’re saying is today we need that supply increased. Of course, in five or ten years – actually, in the immediate, we are also pressing on the accelerator, if you will, to move toward clean energy so that we don’t have to be under the thumb of petro dictators like Putin or at the whim of the volatility of fossil fuels.”

Who wants to put money into an industry facing extermination?

Here’s Krishnamoorthi’s answer to that: He mocked “business decisions” to decommission refineries by putting that term in quotes. “These ‘business decisions,’ his column says, are contributing to record high gas prices and even higher diesel prices.”

You have a partial excuse if you thought renewable energy was far enough along to keep prices reasonable during unusual price pressure like we have today.

It’s that you’ve been hoodwinked. Big tech platforms have been actively suppressing criticism of renewables — at the behest of the Biden Administration. Examples are here from energy reporter Michael Shellenberger.

And the Biden Administration wants more of that censorship. National Climate Advisor Gina McCarthy claimed that the critics of renewables are funded by “dark money” fossil fuel companies, which she compared to Big Tobacco as Shellenberger reported. She claimed the critics are being paid to “fool” the public about “the benefits of clean energy.” “We need the tech companies to really jump in,” she said, because criticizing renewables is “equally dangerous to denial because we have to move fast.”

Aside from an end to that despicable censorship, what America needs is a policy dedicated to restoring the energy independence we had just two years ago and that recognizes the essential role of fossil fuels alongside of renewable sources. Convincing, long-term support for capacity sufficient to refine those fuels should be part of it. Time spent on proposals from politicians like Krishnamoorthi who helped cause the crisis only delay the inevitable reckoning.

*Mark Glennon is founder of Wirepoints.

56 Comments
Newest
Oldest Most Voted
Inline Feedbacks
View all comments
Chatty Cathy
1 year ago

Is this like some kind of bait and switch, or is he trying to impress us with his novel idea?Intentionally (or not) cutting us off at the knees by shutting down what we don’t want shut down before their implementing what we don’t want (green). Pure brilliance. sarc/

I heard this guy on the radio today blathering on regarding the SCOTUS decision and its “implications”. I felt like I had gotten dumber afterwards.

SteveOh
1 year ago

Wow Mark, fabulous article, analysis and research! You’re GREAT at this!

susan
1 year ago

How to calculate production/wholesale cost of a gallon of gasoline:

1 gallon of gas= 1 gallon oil= ~1/42 barrel of oil.

Cost of taxes per gallon: Fed tax= $0.184/gallon; additional taxes vary by geography.

Costs of refining, transpo and retail can be defined as the differential between:
(1/42 cost of barrel of oil+ TAXES imposed) and mean or median cost of a gallon of retail gas nationally.

Waggs
1 year ago
Reply to  susan

Agreed. However, most people don’t realize that a refined barrel of oil doesn’t produce a barrel of gasoline. Each barrel of oil produces a fixed ratio of butane, propane, kerosene, gasoline (45%), petroleum sludge, and more (fractional distillation). Just because we stop using the gasoline in favor of EVs, doesn’t mean that we don’t need the rest of the barrel for jet fuel, lipstick, asphalt, and a thousand other things. Where do the greens propose we dump the 18.9 gallons of gas from each barrel?

Dan Weaver
1 year ago

Perhaps what we really need instead of electric vehicles, is smaller cars and SUVs. Smaller but as powerful engines and better pollution controls instead of gadgets on cars. Europe has had small cars for years seems to work at their gas prices, that has been considerably higher than the U.S. inovation in the automobile and the super sized diesels that are on the road today.

Dan Weaver
1 year ago

Another political idiot. His idea will cost American taxpayer billions, and might not reduce the cost of gas and energy. What we need is common sense in government. Weare paying too much in taxes as is. The stupidity and corruption in government is what we need to work on. There’s a tremendous need for taxpayers to vote on salary increases and taxes to be voted on. The politicians powers need to be curtailed. We the people have the power

Rob
1 year ago
Reply to  Dan Weaver

A super idiot he is. He needs a brain.

Rick
1 year ago

These people live in fantasy land. We just drove to Florida and back, didn’t see a single place along the way to recharge an electric car. 2.5 tanks of gas got us there, fast, the AC was running all the way. In an EV such a trip is impossible. EV’s are basically golf carts. If your EV says it will go 300 miles, reduce that to 230 miles if you want the AC on. EV’s are also coal powered or natural gas powered in most states. In IL 50% of our power is nuclear, but not so in other states.… Read more »

Locke
1 year ago
Reply to  Rick

I just drove my Model Y from the western suburbs to Colorado Springs (2100mi), $132 round trip (including the ~600mi of side trips to Buena Vista, Estes Park and Boulder). The US 70 east, Eisenhower Tunnel route is great as the car charged itself in the eastward downhill descent (had 72% at tunnel entry, 89% once reaching ‘Denver flatland.’) Charging all in added 4 hours to the trip total, wherein we got food at various chargers (the Iowa80 stop is nice – biggest truck stop on the world billing). The Y has a full glass roof, and the AC was… Read more »

Last edited 1 year ago by Locke
debtsor
1 year ago
Reply to  Locke

This is a little bit different story than the reporter from WSJ who had a much more difficult journey

https://www.foxbusiness.com/lifestyle/electric-car-four-day-trip-more-time-charging-sleepingtravelling a few hundred miles in her vehicle.

Last edited 1 year ago by debtsor
Locke
1 year ago
Reply to  debtsor

The key to the platform is the charging network. The car is a piece (Y having fastest charging available – also the Long Range model being key. Taking the standard battery puddle jumper on this type of trip is a different adventure – possibly what this author writes about, i can’t access the article linked), but that existing infra is where Tesla is a decade ahead of the others just entering. Wasn’t a believer, but these guys are the real deal. Jury out on the others, I see failures without their own dedicated charging infrastructure. Really helped me along when… Read more »

Locke
1 year ago
Reply to  debtsor

Found your article .. yeah, PlugShare. Lower power chargers (maybe L2 – akin to a home charger at about 48A – so 11kw/h), maybe 1 or 2 along the trip, never saw any used. Contrast to a Tesla supercharger with 8 to 12 stalls, each at L3 output, pushing 250kW/h.

That there is the secret sauce.

Lots of Windmills all over Iowa, still charging cost at Council Bluffs oddly high.
As I said, need more nuclear baseline, the whirlygigs won’t cut it.

Locke
1 year ago
Reply to  Locke

29min for 1 full charge
The WSJ writer is an amateur.

IMG_D25FAE9FC4E8-1.jpeg
Last edited 1 year ago by Locke
Heyjude
1 year ago
Reply to  Locke

Not sure what you mean by this? Most of us are not engineers and will for sure be amateurs. Only the initiated should be able to use EVs easily?

Last edited 1 year ago by Heyjude
Locke
1 year ago
Reply to  Heyjude

I mean ‘the car build’ is built such that an engineer will look at it and appreciate why this or that was placed or systematized a specific way. ‘Bob from accounting’ had little to no input in the design or build specifics. Contrast this platform to any GM product, you will understand what I mean, with each iteration of a product family getting progressively cheaper in look and feel, and worse in quality. But bottom line being preserved, in GM and the unions benefit, monetarily. Tesla is in a magic time now, with these madmen running it. My fear is… Read more »

Last edited 1 year ago by Locke
Heyjude
1 year ago
Reply to  Locke

Thanks for the explanation, very helpful. I didn’t realize that there was a quality difference among charging options. Sounds like there will be lots to learn for future reference!

Locke
1 year ago
Reply to  Heyjude

Good explanation of the Tesla network here:

https://youtu.be/5_o_ZQ2LQ3w

SadStateofAffairs
1 year ago
Reply to  Locke

While your volume of knowledge is great to hear, it doesn’t really address the larger issue of affordability. Its unrealistic for most Americans. Clearly you are part of the top 1% and that’s good for you. Climate change and the world is ending tomorrow drastic view is what elites want us to believe. Our own federal government is making disastrous decisions with our energy security, and we suffer! All of these are self inflicted wounds that rarely effect people like you. They effect millions of others who simply have to commute for work, be at a job day to day.… Read more »

Locke
1 year ago

I grew up in Gage Park, my parents were first generation immigrants who worked as cleaning people and I drove a Dodge for 19 years until the water pump gave out (saving for a new car once I paid that off), then moved to this. As for anything Marxist, my parents got out of 1960s Poland, so we’re immunized against all things socialist / especially Marxist (they killed enough of our family). Sorry, not the 1%, nice try though with the strawman attack. Just a worker who decided to try an alternative solution. I’m as anti-government and anti-control as they… Read more »

Last edited 1 year ago by Locke
Henry Hatch
1 year ago
Reply to  Locke

Out of curiosity what is the list price of a Y model (Rivian?, Tesla? Chvey Bolt?) Just a question from someone who is not familiar with EVs.

Locke
1 year ago
Reply to  Henry Hatch

Tesla Model Y long range. $52k in Mar 2021. Has increased since then, due to raw material input inflation and demand. I installed the charger myself ($700 in materials), wrote that off federal taxes under the allowed EVSE federal deduction.

Cost of charging at home last year, for 14k miles was ~$96 for the whole 14k miles, offsetting ~$2800 in gas for the same period. So the cost upfront has a continuous backend savings component. Charging done under the ComEd RRTP plan, always overnight when cheapest rates are active.

SadStateofAffairs
1 year ago
Reply to  Locke

I already did something and thats why I am in Texas. I am not going to take the bait as no matter what, most Americans cannot afford this technology. That most Americans struggle to find a good used car under $10k is reality, not Teslas or Lucids. Even used Teslas. He with the most zlotys wins, just because your from Gage Park doesn’t mean you know what a good pizza tastes like. One can only pray.

Locke
1 year ago

Texas, great state, alot of my countrymen settled there in the 1800s. I’ve done some work with the A&M guys, smart and hard working kids. My car purchase therefore supported your new state and went to the local American workers, not some wholly foreign conglomerate, I think that’s a win. Zloty, nope, never again. After a stay at camp Auschwitz and the Stalinist afterparty, my family is not interested. Don’t drop the marxist tag willy nilly, some people still have really hard feelings about that. If you have issues with cost, you may want to look at the value of… Read more »

Rob
1 year ago
Reply to  Locke

Great article here. I am with you.

Rick
1 year ago
Reply to  Locke

I got to hand it to you, we saw no chargers. We did not take the Interstate highways either, all the way through Illinois it was two lanes and Baily for Governor signs, no chargers. Got on the Interstate for a while in Indy and Ohio, then Alabama and Florida, Tennessee, Kentucky was all scenic two laners. And again no charger signage anywhere.

Locke
1 year ago
Reply to  Rick

I took I88 to I80, then I76 to US25. Chargers present, though not always as visible as a BP station. The car leads you in to the exact location. Usually I need the kids or Mrs. to act as the spotter that last leg, as these chargers are hidden away in some cases, they just shoehorned them in where space / utility connects existed. We did alot of 2 laners on the back range (Colorado Springs to Buena Vista to Silverthorne), with some 5k to 7k elevation changes. Car really did well, when it was time to charge, it notified… Read more »

The Railroader
1 year ago

Raja and Casten are the (allegedly) male members of The Squad. Their idiocy has known no bounds since Illinois voters foolishly sent them to The Swamp. The Chicago Media continues to slobber all over these two as they dance to imaginary music in their Climate Priest garb singing loudly their one-note TDS song. Green energy simply doesn’t work. Recently, the last coal train was delivered to the Romeoville generating plant. When the coal is gone, so is the electricity the plant generates. Then, watch for the brownouts and blackouts that the ‘green’ parts of the grid have already experienced throughout… Read more »

Ex Illini
1 year ago

Hey Raja, it might be better if you said nothing and let us all wonder if you are an idiot, rather than write a ridiculous op-ed based on zero facts and remove all doubt.

Kani
1 year ago

Fear mongering. Government have been spewing Green Energy for years and they’re still no where near being ready. MISO isn’t ready, states are bickering about costs. This Scam is about the bite the government in their corrupt a**.

SadStateofAffairs
1 year ago

Fixing stupid is a difficult thing. This goes back to the increasingly ‘low IQ” Illinois voter who continues to vote for these politicians and ultimately this is what they asked for. You can only feel sympathetic for this for so long, its pathetic that there really is not even a decent opposition.

ToughLove
1 year ago

Exactly. At first there is sympathy, but later there is astonishment at the sheer stupidity of the voters.

nixit
1 year ago

The most important aspect of energy is stability. If you don’t have a stable source of energy, things will go downhill quickly. Instability will actually hamper progress towards renewables. The whole “there’s no turning back in 11/9/7 years” argument has caused more environmental harm than fossil fuels. We’ve decommissioned nuclear plants and replaced them with coal and gas. We can’t even talk about nuclear because “it’ll takes too long”, yet every year that passes is another year we would have been closer otherwise. Meanwhile, we’re turning to other countries to provide oil, countries that have less environmental regulations when extracting… Read more »

Lion's Choice
1 year ago

Low Information/Economically Illiterate Illinois Democrat Congressman — Raja Krishnamoorthi — Can’t Understand Why Oil Companies Are Not Going To Spend Billions To Temporarily Reopen Oil Refineries — Refineries That Biden Will Immediately Close After The Election

Platinum Goose
1 year ago

They should turn it around on him, tell him why aren’t you going after the solar and wind companies. Make them sell their products for less money so everyone can have solar panels on their roof. And while you’re at it make the sun shine and the wind blow eight hours a day. If they really want clean reliable energy then they should invest in nuclear and hydroelectric. Time to start asking these politicians some basic questions about economics or running a business. My guess is they can’t answer even the simplest question.

SUE
1 year ago
Reply to  Platinum Goose

YOUR LAST SENTENCE SAYS IT ALL!!……….THEY HAVE NO ANSWERS……..JUST REASONS TO KEEP TAKING YOUR TAX DOLLARS

ProzacPlease
1 year ago
Reply to  Platinum Goose

That’s a really good idea, turn it around on them. Ask them why they aren’t demanding that solar, wind and EV makers give us everything we need at an affordable price?

Alphabet Soup
1 year ago

Who elects these bimbos?…sheesh!

ToughLove
1 year ago
Reply to  Alphabet Soup

Probably your neighbors. That’s why I keep saying the Illinois situation is hopeless. You don’t need to move to Tennessee like I did, but you do need to move to a red state.

SadStateofAffairs
1 year ago
Reply to  ToughLove

Can’t agree more. Sad to say these things but they are the truth. Vallas should have replaced Daley, Rauner should have been more competent, Quinn should have been the true reformer he claimed to be, fill in the ________Reforms needed to happen 20+ years ago. What we see now is the slowly sinking ship, only matter of time. Pritzker has everything and everyone on his payroll. Unlimited warchest. Yes he is worthless but I really have zero faith in the Illinois voter. Zero. If by a snowballs chance in hell that we can turn this around it will be like… Read more »

debtsor
1 year ago

“Rauner should have been more competent” Rauner was competent but his entire agenda was DOA because Madigan. Madigan basically said this the day after the election. Rauner, having no other options, bet the house on the budget impasse and lost because four ‘Republicans’ who all choose not to run again overrode his veto. Rauner gave an interview after he moved to FL saying that the entire state government is filled unionized Democrat activists that purposely undermined all of his powers. He said he couldn’t fire them, couldn’t demote them, couldn’t shrink government, he couldn’t do anything without Madigan’s legislature, that… Read more »

debtsor
1 year ago
Reply to  ToughLove

The problem with Illinois is the people who live here. Mostly the northern part of the state.

SadStateofAffairs
1 year ago
Reply to  Alphabet Soup

The people of Illinois that’s who. They don’t want to do any research on their candidates and honestly you can either vote for usually one party with a few choices within. This is really a one party system.

SUE
1 year ago

JUST ANOTHER DEM IDIOT………VOTE THESE IMBECILES OUT!!!!!!!!!!!!!

Bosco
1 year ago

You can always count on nonsensical ideas from Democrats . Especially when they try to address problems that they created.

JackBolly
1 year ago

Is it possible at all to understand the voters who put someone like Krishnamoorthi into office? I guess the same ones who put in Duckworth. Their cluelessness is astounding, but their willingness to be tyrants is very telling.

Last edited 1 year ago by JackBolly
Susan
1 year ago

Ethanol. Here is data, without regard for ethics of food-vs.- Fuel. Productionconversionratios: 2.8 gallons ETOH per bushel of corn. Corn futures December delivery contract $6.92/bushel. https://futures.tradingcharts.com/marketquotes/C.html Inputs cost: $6.92/2.8= $2.47 per gallon. Fixed production cost at refineries 2019 $0.35/ gallon. https://www.eia.gov/todayinenergy/detail.php?id=40813 Fixed+variable production costs 2019 (but using current corn price per bushel delivered) = $2.47+$0.35= $2.82/gallon. 1.Transportation and distribution to local stations add costs per gallon. 2.State and local and federal taxes add costs per gallon. 3.Necessary profits for refineries and local distribution stations add costs per gallon. (Note: e85 yields about 15% fewer MPG than petroleum fuel in flex… Read more »

Freddy
1 year ago
Reply to  Susan

In addition the corn sweats called evapotranspiration which increases humidity which in turn increases dew point to make us feel miserable. Then to feel cooler we crank our A/C-dehumidifiers/fans 24/7 which increases our energy bills and they are going to rise more and more. So how do we conserve energy from every aspect when farmers have the right and get subsidies to plant a crop which we as consumers have higher energy bills and get NO subsidies? In addition to ethanol don’t forget HFCS (high fructose corn syrup which is in many products and all the subsequent health problems associated)… Read more »

susan
1 year ago
Reply to  Freddy

In order to perform a relevant comparative analysis, you must look at specifics rather than generalities of ‘subsidies’ and other issues you have raised.
Please give us a price point per-gallon or per bushel for whatever supports your opinion.
Give us the alternative (fields of weeds rather than fields of corn) and comparative transpiration ratios.

susan
1 year ago
Reply to  Freddy

BTW, farm subsidies are an emotionally generalized issue. I urge you to look up the specifics of how to qualify for what average voters are led to believe are rampant ‘farm subsidies’.
Please post your finding so that we can all learn something rather than be trapped in emotional net of forced inertia by usatoday.

Freddy
1 year ago
Reply to  susan
susan
1 year ago
Reply to  Freddy

As you must note from careful reading of my post, the raw numbers do not include subsidies. The data presented are raw input costs.

I do not understand your comments as they seem to simply divert the focus away from an apples-to-apples comparison of the cost of a gallon of ethanol fuel in Illinois to the cost of a gallon of petroleum fuel in Illinois.

susan
1 year ago
Reply to  Freddy

If I understand you correctly, you are vaguely and in a generalized way indicating that agriculture is bad because it receives subsidies. Fair enough. Free-market proponents are opposed in general to subsidies (which can be characterized as taking from the many-anonymous to give to the few-insider-connected). Now, quantify your objections, and do not fail to take into account all the specifics. Exactly which subsidies would you remove? Crop insurance? Then what would you propose to counterbalance foreign-ownership-transfer from small family farm ownership in any given drought year which causes catastrophic economic failure for small-holding farms? Would you propose changing laws… Read more »

Freddy
1 year ago
Reply to  susan

In many ways agriculture has been poisoned with chemicals/pesticides/GMO’d/DDT years ago so that the final crop is mostly devoid of any nutritional value to humans and animals.The seeds are patented so farmers have to buy them yearly. How many people now have some sort of wheat allergy or Celiac disease due to the way they process the crop? I would offer some sort of subsidy to any organic farmer if needed. We need to put magnesium back into the fields and grow healthy crops and go back to producing the way it was decades ago but with modern technology. Simply… Read more »

susan
1 year ago
Reply to  Freddy

I think you have some granular info in there worth noting. Now put those figures into a spreadsheet, and include all other such related figure relevant to the problem you might try to solve: (something like): Food must be produced for a human to survive. People are apparently unwilling to live in such a way as to personally produce their own sustenance level food. 2.a. People personally producing their own sustenance level food is inefficient: should a doctor or physicist or computer tech spend all day in the field, or working in a field which optimizes their talents and abilities?… Read more »

SIGN UP HERE FOR FREE WIREPOINTS DAILY NEWSLETTER

Home Page Signup
First
Last
Check all you would like to receive:

FOLLOW US

 

WIREPOINTS ORIGINAL STORIES

Chicago area loses population for third year in a row, third-worst loss among big metros – Wirepoints

The latest 2023 Census population estimates show migration and population changes have largely returned to their pre-pandemic patterns across the country. Metro Chicago’s loss of 16,600 people is the 3rd-highest decline among the nation’s metropolitan areas. Only the Los Angeles area (down 71,000) and the New York City area (down 65,000) lost more people than Chicagoland.

Read More »

WE’RE A NONPROFIT AND YOUR CONTRIBUTIONS ARE DEDUCTIBLE.

SEARCH ALL HISTORY

CONTACT / TERMS OF USE