Why Trump's effort to boost refining capacity won't lower gas prices
The headline points to an effort to add refining capacity, which could eventually increase gasoline and fuel supply.
Source →The trace
How it reaches your house.
Starting from Crude Oil Feedstock, we walked the supply graph hop by hop to the goods you buy and the companies you own. Each step is the engine’s reasoning, scored for confidence and cited where a source backs it.
First impact
Crude Oil Feedstock →supply upCrude oil feedstock is a critical required input to gasoline and diesel, so expanding refining capacity should raise output and availability of these products.
83% confidenceCrude Oil Feedstock →supply upCrude oil feedstock is also a critical input for home heating oil, so more refining capacity can increase its supply as well.
78% confidencePBF Energy →Prices riseIf PBF is pushed to add refining capacity, its demand for crude feedstock rises; with U.S. refineries already near the ceiling and little spare capacity, the incremental demand is more likely to lift crude costs than quickly lower gasoline prices.
Hop 2
Home heating oil →Prices riseHigher refinery throughput raises demand for crude feedstock, and this is the direct critical input to home heating oil production.
88% confidenceHome heating oil →Prices riseMore distillate output requires more refinery-grade hydrogen for hydrotreating and desulfurization, so this critical input faces higher demand.
80% confidenceHome heating oil →Prices riseNatural Gas (SMR feedstock for hydrogen)
If refinery hydrogen is made by SMR, extra hydrogen demand transmits back to natural gas, its main feedstock.
Hop 3
Hydrogen (refinery-grade) →Stands to benefitAir Products and Chemicals, Inc.APD
If refining capacity expands and refinery-grade hydrogen demand rises, Air Products' large 40% share of supply stands to benefit.
74% confidenceHydrogen (refinery-grade) →Stands to benefitLinde plcLIN
Linde is a major hydrogen supplier, so higher refinery demand for hydrogen should translate into a clear volume and pricing tailwind.
73% confidenceHydrogen (refinery-grade) →Stands to benefitHop 4
Linde plc →Prices riseMore refining capacity increases demand for refinery-grade hydrogen, and Linde's sizable 35% dependency with an 18-month replacement lead time makes this input costlier.
58% confidenceAir Liquide S.A. →Prices riseMore refinery capacity tends to increase demand for refinery-grade hydrogen, and Air Liquide’s dependency on that input is material (20% share, low substitutability, 12-month replacement horizon), so the input is likely to tighten and get pricier.
53% confidence