Scroll down for more…
Welcome to the opposite of stimulus. Via Bloomberg:
America’s biggest oil companies will probably cope with U.S. carbon legislation by closing fuel plants, cutting capital spending and increasing imports.
Under the Waxman-Markey climate bill that may be voted on today by the U.S. House, refiners would have to buy allowances for carbon dioxide spewed from their plants and from vehicles when motorists burn their fuel. Imports would need permits only for the latter, which ConocoPhillips Chief Executive Officer Jim Mulva said would create a competitive imbalance.
“It will lead to the opportunity for foreign sources to bring in transportation fuels at a lower cost, which will have an adverse impact to our industry, potential shutdown of refineries and investment and, ultimately, employment,” Mulva said in a June 16 interview in Detroit. Houston-based ConocoPhillips has the second-largest U.S. refining capacity.
The same amount of gasoline that would have $1 in carbon costs imposed if it were domestic would have 10 cents less added if it were imported, according to energy consulting firm Wood Mackenzie in Houston. Contrary to President Barack Obama’s goal of reducing dependence on overseas energy suppliers, the bill would incent U.S. refiners to import more fuel, said Clayton Mahaffey, an analyst at RedChip Cos. in Maitland, Florida.
“They’ll be searching the globe for refined products that don’t carry the same level of carbon costs,” said Mahaffey, a former Exxon Corp. refinery manager.
Prices Seen Rising
One in six U.S. refineries probably would close by 2020 as the cost of carbon allowances erases profits, according to the American Petroleum Institute, a Washington trade group known as API. Carbon permits would add 77 cents a gallon to the price of gasoline, said Russell Jones, the API’s senior economic adviser.
Heritage analysis of the economic impact of Waxman-Markey cap and trade: Read here.blog comments powered by Disqus
House vote expected today after Senate passes fiscal cliff compomise; Deal would include extension of Hollywood tax incentives; House voting on Senate bill with no amendments; Update: Fiscal cliff deal passes the House
January 1, 2013 11:27 AM by Doug Powers
November 5, 2012 11:14 AM by Michelle Malkin
WSJ: Obama told Boehner if no agreement is reached he’ll use inaugural/SOTU speeches to blame Republicans
December 23, 2012 12:33 PM by Doug Powers
Boehner to bring ‘Plan B’ to a vote in the House, force Dems to own the ‘largest tax increase in American history’
December 19, 2012 07:31 PM by Doug Powers
May 28, 2012 12:40 AM by Michelle Malkin