Imported oil cost nearly $20 a barrel more than Texas oil

Houston Chronicle:

Rising gasoline prices have become a source of finger-pointing and political rhetoric - yet the economic reality for some refiners is that the price isn't high enough.

They say that gasoline prices, particularly on the East Coast, have been too low for them to operate successfully. Already, two refineries there have shut down completely and a third has gone idle as prices for fuel haven't kept up with the surging cost of the raw material, crude oil.

"In an environment like this, where the price of crude oil is rising faster than the price of the product that the refineries make, the profits get squeezed, and in some cases they're not profits at all," said Bill Day, a spokesman for San Antonio-based Valero, the nation's largest refiner.

High world oil prices and declining U.S. demand for gasoline have been a major part of the problem, said Charles Drevna, president of American Fuel & Petrochemical Manufacturers.

The result has been lower domestic gasoline production in regions where refineries rely on imported crude. Oil sold globally is more expensive than crude that is produced and refined in parts of the country with limited access to the world market.

Brent crude, used as a benchmark for world oil, closed Wednesday at $124.16 per barrel, down $1.38. West Texas Intermediate, the U.S. benchmark, closed at $105.41, down $1.92.

On the East Coast, where refiners rely on foreign crude, production dropped from 93 percent of capacity in 2005 to 63 percent in 2011 because of high world oil prices, according to the U.S.

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The real lead should be how much cheaper it is to buy domestic oil.  This goes against the narrative of Obama and the anti energy left that domestic drilling can't lower the price of gasoline.  It already is doing it and would do it nationwide if Democrats would get out of the way of drilling and quit trying to strangle domestic production.