Crocodile tears from the oil industry

This is not something I know a lot about. I just have my bullshit detector set appropriately high for the profit-making corruption of modern American business, politics, and media - hard to tell where one starts and the others stop these days...

For some reason, CNN today briefly reposted this piece of propaganda from July 11, probably facilitated by the PR shell called the Petroleum Institute. More evidence that the CNN story was a PR placement is how well it matches the July 22 story from the New York Times that I already commented on in "Trying Too Hard".

So, Trilby Lundberg's claims:

1. Refineries damaged in the 2005 hurricane season are breaking down.
2. More complex environmental regulations raised the poor wittle refineries' costs.
3. Ethanol subsidies push prices up.

I'll start with the easy bullshit first. Ethanol subsidies can't be responsible for a price change, only for a part of the price. My wild guess: less than 5 cents a gallon, possibly less. But, in the interest of not purveying my own brand of bullshit, I got out a little google. USAToday provided the nuggets I needed at the end of this: In March, wholesale gas prices were about 60 cents lower than ethanol. In a 10% mix, that's 6 cents, for 15%, 9 cents. With gas above $3.

Then I found this, which erases even that small cost, assuming it is true.

Even easier BS: More complex environmental regulations during the Bush Administration? That would be funny if it didn't hurt so much.

So, what about the damage from Katrina and friends? Maybe. But I'm always skeptical of "data" that begins and ends with anecdotes about raccoons and possums. How cute for Lundberg amidst her pleading for more serious coverage of why gas prices spike, uh, change.

Nonetheless, I'm no fan of ethanol as a route to much of anything other than higher corn prices. (Hey, a point of agreement.) If it's a net gain of energy independence, it's still a pretty marginal one.

More evidence of a manipulated market? CNN is happy to oblige as long as they don't have to connect the dots. Here's "Why oil is rising but gas gets cheaper". Gas prices went up while crude prices came down; now they're going down while crude prices fall. Sure, that's a free market!

The "analysts" don't know whether their bullshit is coming or going. Witness:

Usually oil and gas prices move in tandem. Yet this time around, analysts say the disconnect is all about refining. If refineries keep churning out gas, and crude doesn't spike too much further, some say motorists could see gas prices under $2 a gallon by winter.

$80 oil lurks

Normal people's heads would explode from all this paradox, but not PR people's heads.

Lundberg thinks conservation is something consumers should "see through". And she is a global warming disbeliever, but even if it's true, she's o.k. with us changing the environment to keep our Hummers.

Let's face it, this is someone who can read, add, and take averages, not skills that demand our trust. Read her numbers, but forget her analysis.

In the long run, Asian demand will force gas prices up much higher than they are now. Of course, Lundberg ignores this inconvenient market force.

The oil industry is just thrilled they've gotten prices where they are in time for this quarter's profits.