US Stuck in Oil Dependence Loop: Why New Refineries Are a Pipe Dream

The United States' dependence on Middle Eastern oil is a long-standing issue that has been plagued by various obstacles. President Joe Biden's statement, 'There is nothing we can't do if we do it together,' echoes a sentiment expressed by former President Barack Obama, who also emphasized the need to overcome this dependence.

The main challenge lies in the difference between American oil production and Middle Eastern crude. The US primarily produces light, sweet crude from shale formations, whereas the Middle East supplies heavier, higher-sulfur crude. Old US refineries were not designed to process heavier crude, making it difficult to integrate Middle Eastern oil into the domestic supply chain.

Building new refineries would require significant investment, estimated in the billions of dollars. Additionally, they would face environmental regulations and be considered a financial risk due to the shift towards renewable energy and electric vehicles.