Trump's Refining Plan May Not Lower Gas Prices
President Donald Trump's plan to boost US refining capacity by reopening shuttered refineries and expanding existing ones may not have the desired effect of lowering gas prices. According to industry experts, it takes at least three years to significantly expand an oil refinery, and even longer for a new one to be built.
The current spike in gas prices is largely due to global market disruptions, including military attacks on refineries in the Middle East and Russia, which has led to a shortage of refined fuel. ExxonMobil CEO Darren Wood noted that there's an 'excess (refining) supply' no longer, but rather a 'refinery constraint' driving up prices.
US refiners are currently running at nearly 100% capacity, with some even deferring maintenance to maximize output and profits. However, this cannot be sustained in the long term, and temporary shutdowns for maintenance will eventually lead to supply reductions and price increases.