Quote:
Originally Posted by TurnedTheCorner
My understanding of the market for the past year is that supply/demand are very tight - even a small supply reduction is not absorbed by the market very well, especially with ever growing demand domestically and abroad. The high prices give companies more incentive for E&D, which help address supply side issues somewhat. But with the demand increasing constantly, it's a high wire act.
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Not to mention the fact that building another refinery is not always the most effective solution for the Oilco's -- it can be more profitable to sell their product at a high price in a artifically created "high demand / low supply" market. I could be wrong, but I don't believe any refineries of significance have been built in North America over the last two decades...