In a June 18 report, KUSA 9News co-anchor Mark Koebrich uncritically repeated the oil industry viewpoint that the nation's “push for biofuels” could result in “high gas prices for years to come because supplies would remain very tight,” but offered no opposing response. In contrast, The Pueblo Chieftain published a June 18 Associated Press article about the biofuels “push” by Congress and the White House that included comments from "[c]onsumer advocates" who “maintain the oil industry likes” to keep refinery capacity low, and a June 18 KDVR Fox 31 report noted that “drivers are fuming” over high gasoline prices.
Koebrich reported that the industry is “thinking of scaling back refineries” because of the move “toward greener fuels.”
From the June 18 broadcast of KUSA's 9News at 6 p.m.:
KOEBRICH: As America moves toward greener fuels, oil companies are now rethinking their plans to boost their capacity. Refiners are thinking of scaling back refineries and not building new ones. That's because of Congress' push for biofuels like ethanol and President Bush's call for a 20 percent reduction in gas use. The result could be high gas prices for years to come because supplies would remain very tight.
The AP article similarly reported that "[a] push from Congress and the White House for huge increases in biofuels, such as ethanol, is prompting the oil industry to scale back its plans for refinery expansions. That could keep gasoline prices high, possibly for years to come." The article continued:
With President Bush calling for a 20 percent drop in gasoline use and the Senate now debating legislation for huge increases in ethanol production, oil companies see growing uncertainty about future gasoline demand and little need to expand refineries or build new ones.
Unlike 9News, however, the AP reported the criticism of “consumer advocates”:
“By creating a situation of extremely tight supply, the oil companies gain control over price at the wholesale level,” said Mark Cooper of the Consumer Federation of America.
[...]
Ron Lamberty of the American Coalition for Ethanol, said all the talk about biofuels threatening gasoline production is the ''latest attempt to blame ethanol on Big Oil's failure to meet our energy needs.''
''The ethanol industry continues to grow while oil refiners continue to make excuses for maintaining their profitable status quo,'' said Lamberty.
Sen. Byron Dorgan, D-N.D., said consolidation of the oil industry into fewer companies has left them with no incentive to expand refineries.
''It's a perverted system that does not act as a free market system would act,'' said Dorgan. ''If you narrow the neck of refining, you actually provide a greater boost to prices which is a greater boost to profitability.''
Also in contrast to 9News' coverage, a similar June 18 report by Fox 31 noted that the push for alternative fuel sources was “prompting the oil industry to scale back plans for refinery expansions, which means gas prices may not be budging.” Fox 31 then featured an interview with a consumer at a gas station who said the policy is “all about money and the oil companies getting rich”:
From the June 18 broadcast of KDVR Fox 31's News at Nine O'Clock:
LIBBY WEAVER (co-anchor): Well, if you're shopping for cheaper gas prices, don't hold your breath. The pain at the pump may be here to stay. It's partly because of a huge push from Washington for alternate fuel sources like ethanol. That's now prompting the oil industry to scale back plans for refinery expansions, which means gas prices may not be budging. And now drivers are fuming.
JODY BROOKS (consumer): Well, I think it's all about money and the oil companies getting rich. And people here are working hard and struggling to put gas in. Takes about 75 dollars to fill this up.
WEAVER: Well, the Senate in -- is now debating legislation which calls for 15 billion gallons of ethanol used by 2015 and more than double that by 2022.
