# Economics 101: why does lack of refining capacity drive the price of oil up?

**URL:** <https://boards.straightdope.com/t/economics-101-why-does-lack-of-refining-capacity-drive-the-price-of-oil-up/319274>\
**Category:** Factual Questions\
**Created:** [August 30, 2005, 4:17pm UTC](https://boards.straightdope.com/t/economics-101-why-does-lack-of-refining-capacity-drive-the-price-of-oil-up/319274 "2005-08-30T16:17:21Z")\
**Posts on this page:** 1\
**Page:** 2

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**Author:** ![David\_Simmons](https://avatars.discourse-cdn.com/v4/letter/d/9de053/32.png) [@David\_Simmons](https://boards.straightdope.com/u/David_Simmons)\
**Post date:** [August 31, 2005, 12:52pm UTC](https://boards.straightdope.com/t/economics-101-why-does-lack-of-refining-capacity-drive-the-price-of-oil-up/319274/21 "2005-08-31T12:52:55Z")

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> [@KellyM](#):
>
> I’ve also heard the claim repeated many times on the radio (I don’t watch TV news) that “lack of adequate refining capacity” is driving up the price of crude oil. I’ve heard it said too many times to believe that it’s due just to misunderstanding, or simply conflating crude oil with refined petroleum products like gasoline. I’ve even heard this assertion credited to Saudi Arabian officials.

Having worked in news long ago I’m not at all surprised that things can get warped in the retelling. In fact it is surprising to me that the news about rather complex things is as good as it is.

News is largely gathered by a group of people who are not specialists in the subject the news concerns. That raw material is passed on to another group, again not really knowlegeable about the subject matter, who assemble it and put it into shape to be printed, broadcast or whatever. In the case of radio and TV it is then read on air by still a third group whose asset is that they have a nice voice or can be made up to look good, or both.

And still they manage to get some things right. Mostly though, except for straight reporting of an event like an automobile accident, it is just a little (or sometimes a lot) off.

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