Friday, February 25, 2011

Pinched or Screwed at the Pump?

Port Townsend, today. Everyone is feeling the "Pinch or Screw at the Pump" these days, and of course, the oil companies, (whom the Republicans love to give massive tax credits to,) are going to "milk" the unrest in the Middle East for all it's worth.

Looks like another banner year for oil company profits, and it's only February.

I am really confused about all this, since what goes on in the middle east has zip to do with our gasoline supplies. Here in the Pacific Northwest, our gasoline comes from refineries in Anacortes, processing crude oil shipped by tanker (remember the Exxon Valdez?) from the North Slope via Valdez. Still more crude comes to Anacortes from B.C.

There are pipelines transporting product in western Washington and Oregon from Anacortes, Washington - Kinder Morgan and Olympic. Chevron supplies the eastern part of Washington and Oregon via pipeline from Salt Lake City, and Yellowstone delivers across Montana and Idaho into eastern Washington.

I think we are getting screwed at the pump. And I don't hear a damn moan or groan from anyone about it!

Even the folk who haul the crude are looking for ways to reduce their liability during this period of elevated oil prices. Maersk Tankers announced a change in modus operandi in a recent news release:

Maersk Tankers is taking slow steaming to a new level on its VLCCs with speeds as low as 8.5 knots – something that no other tanker owner has done.

The company said that it had taken a hard look at bunker consumption, which for example, on the VLCCs makes up about 85% of the voyage costs.

By slow steaming, the company had significantly improved earnings over the past 18 months, compared to competitors.

Ballasting at 8.5 knots – compared to the normal 14-16 knots - saved about 50% in bunker costs on the ballast leg and removed $400,000 on the bunker bill for a standard round voyage.

However, it also added another 11 days to the voyage, but as Maersk Tankers’ CEO Søren Skou commented in a recent interview:

“What it effectively means is that on an Arabian Gulf to Japan or China voyage the fuel savings will pay for the additional days. It doesn’t really cost you to extend the time the voyage takes and you are doing something good for the environment.”

1 Comments - Click here:

Rivrdog said...

What the oligarch meant was that by adding 11 days to the steaming schedule, they get 11 more days of price increases when said prices are on the upswing.

Just watch if there is a general oversupply, caused by the high price point. All of a sudden, those VLCC Captains will get the order to run at flank speed.

It's all about money, it was only EVER about money, and anyone who says otherwise is lying.


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