Why cutbacks in oil refinery capacity?
According to the report, “Major oil company threats to offset increases in ethanol production with cutbacks in refinery expansion plans and company policies that restrict ethanol distribution are serious and demonstrate their unchallenged market power and their ability to limit competition which could help consumers obtain lower prices for gasoline and diesel fuel.” Cooper also says oil company mergers and refinery closures have skewed the market in favor of a handful of big companies that now have the ability to keep gasoline supplies tight. “As the oil refining business has become a tightly held shared monopoly, the opposite has happened with ethanol. With entry of new ethanol firms and construction of new ethanol plants “the ethanol industry has become highly competitive.” Oil company refining profits in the United States have reached dramatic highs in the last few years. “In fact,” says Cooper, “refinery profits in the U.S. are now three times more than in some other parts of the w
