Senate Democrats want to pay for renewables with taxes and royalties on oil companies.
This pressure is causing the oil lobby to threaten higher gasoline prices:
Bill Holbrook, communications director for the National Petrochemical and Refiners Association, told ABC News that there are conflicting signals about what path the nation will take coming from both President Bush and lawmakers on Capitol Hill. The president is calling for a 20 percent reduction on gasoline use while some lawmakers are pushing for more biofuels.
If you process gasoline, those in the industry say that none of those developments are necessarily going to make you want to process more.
“If you’re a manufacturer in any industry you’re going to consider what the implications are going to be 10 years down the road,” Holbrook said. “Are you going to make an investment or reinvestment now to expand production … to continue making a product that some are trying to limit the distribution of.”
Say "analysts" …
… there "is a widespread view among the oil industry leadership that it is foolhardy to add refining capacity in a market where the federal government is actively promoting and subsidizing alternative fuels as a substitute for petroleum products."
Says a spokesflack for the American Petroleum Institute … er, API:
"[Oil companies] are in the business to meet demand and have a reliable supply but they are also in the business to see a profit," she said. "If the demand’s not going to be there, it doesn’t make sense to have that investment."
They’re in business to make a profit? Who knew? I wonder what level of profit would be enough to lead to refinery investments.
This is utterly craven, but probably effective. Nothing gets the attention of a junkie like threatening his fix.
(hat tip: AS)