U.S. Refiners in Harm’s Way If Trump Blocks Saudi Oil
President Trump has spent significant political capital during the coronavirus pandemic tending to the wounds of shale oil producers, but refiners who transform the crude into fuels for consumers are suffering as well.
Refineries, with no demand for their fuel, are already operating at about 30% lower capacity than what they usually do, and some have shut down operations completely.
“U.S. refiners, especially the independents, are also facing the same economic crunch as the shale guys, and we could also see some bankruptcies,” said Joe McMonigle, a former Energy Department chief of staff in the George W. Bush administration.
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“It would seem to be more politically perilous to ignore the refining issues,” McMonigle said. “Consumers and politicians seem to be extremely sensitive when pump prices rise. Imagine if some refiner bankruptcies result in gasoline shortages or the country needs to start importing gasoline and products. The political backlash has potential to be big.”
"U.S. Refiners in Harm’s Way If Trump Blocks Saudi Oil," by Josh Siegel was published in The Washington Examiner on April 26, 2020.