Keystone XL: A Pipeline to Higher Oil Prices

  • Midwestern refineries produce more gasoline per barrel than refineries in any other region in the United States. That gasoline is then sold to U.S. consumers.
  • In contrast, refineries on the Gulf Coast of Texas produce as much diesel as possible, much of which is exported internationally.
  • The Keystone XL tar sands pipeline would divert oil from the Midwest to refineries on the Gulf Coast of Texas. By taking oil from Midwestern gasoline refineries to Gulf Coast diesel refineries, Keystone XL will decrease the amount of gasoline available to American consumers.
  • TransCanada, the company sponsoring the pipeline, pitched the pipeline to Canadian regulators as a way of increasing the price of crude in the United States. Right now, Midwestern refineries are buying crude oil at a discount—and a deep discount at that. This allows them to produce products more cheaply than they would otherwise be able to. Building Keystone XL would change that. If TransCanada’s analysis is accurate, under current market conditions, Keystone XL would add $20 to $40 to the cost of a barrel of Canadian crude—increasing the cost of oil in the United States by tens of billions of dollars.

    To read more about the Keystone XL scam, John Boehner’s favorite legislation, considering it was his last holdout bargaining position on the last extension of middle class tax cuts, please click here