President Trump urged a gathering of oil executives at the White House on Tuesday to build more refineries capable of pumping out fuel, part of his bid to bring down gasoline prices before the November midterms.
That's a tough argument to make. Owning an oil refinery is a profitable proposition in the U.S. right now. Building a new one? Not so much.
The paradox helps explain why U.S. refinery operators that are making record profits in the midst of historic fuel supply disruptions in the Middle East, Russia and China have no plans to expand their fleet.
Put simply, the oil companies don't expect the boom times to last.
At the meeting, the president and oil executives discussed other ways to expand the nation's refining capacity, including cutting regulations, speeding up the permitting process and making additional investments.
"The President made clear that he wants lower gas prices at the pump for Americans. The refiners and distributors shared that goal and commitment," a U.S. official said.
The White House also said Trump's surprise deal to take a direct stake in a large swath of Venezuela's oil reserves means the country needs more refining capacity to absorb barrels as production comes online.
Among those gathered were executives from Chevron, Valero Energy, Marathon Petroleum and PBF Energy, among others. ExxonMobil, the nation's third-largest refiner, didn't send a representative.
Some companies were initially wary of attending, given Trump's recent attacks on the industry for not cutting gasoline prices more quickly. Americans paid about $4.10 a gallon on average at the pump Tuesday, according to AAA, up from $2.98 before the start of the conflict in Iran.
The problem: Much of what is driving fuel prices higher is beyond the control of both the president and what he has called his favorite industry.
Six months into the war, the supply crunch for diesel, jet fuel and gasoline has overtaken upheaval in the crude-oil market as the energy industry's primary concern.
To keep up with demand, U.S. refineries have been running at over 97% of their collective capacity in recent weeks, near their highest rate in about eight years, according to the Energy Information Administration.
"The utilization that we've seen can't be sustained for the long term," Darren Woods, the chief executive of Exxon, told investors in late July. "I think this refining challenge is going to be with the world for a while."
Some companies are putting off scheduled maintenance to take advantage of lofty margins for diesel and other fuels. What's known as the crack spread-the difference refiners can pocket buying crude and selling fuel-recently hit a record above $100 a barrel for diesel.
That has helped pad the industry's bottom line. The top six American energy companies that turn oil into refined products made a combined $24.7 billion on fuel-making in the second quarter, nearly five times as much as a year earlier.
But building new refineries isn't economic-it would require an investment of several billion dollars and three to five years of construction. The industry expects the energy market to have found its footing long before then.
Instead, companies have focused on expanding and modernizing existing facilities.
"Nobody's going to go out and make a huge multibillion-dollar investment based on three months of record margins," said Robert Campbell, an analyst at Energy Aspects in New York. "You really think there's going to be another situation where Russia's being attacked, and there's a crisis in the Middle East, and China has slowly stopped exporting products?"
America has been closing refineries for decades-it has 128 fewer than it did in 1982. The newest was completed in 1977; roughly a quarter were built more than a century ago.
The obstacles to building new ones are formidable. For one thing, acquiring the myriad permits needed from federal, state and local governments would be a major undertaking. The oil industry has tried for years to convince Congress to overhaul the permitting process to clear the way for pipelines and other energy infrastructure.
Gasoline demand, meanwhile, is expected to decline over the long term as drivers buy more electric vehicles and engines become more efficient.
"Who wants to invest in something that, by the time you build it, the demand is down?" said John Auers, marketing director of refined fuels at oil-and-gas data analytics firm Novi Labs.
Auers estimates oil companies have room to add 400,000 barrels a day of refining capacity by expanding their facilities in Texas, Louisiana and other Gulf Coast states over the next 20 years. That is roughly equivalent to the capacity of one large refinery.
Analysts are skeptical that new projects can get off the ground.
Trump said in March that a startup called America First Refining would open the first new U.S. oil refinery in 50 years in Brownsville, Texas. The $300 billion deal was meant to bring jobs and economic growth to South Texas.
Yet the region lacks infrastructure to get sufficient oil to a refinery, and financing such a project would be a challenge, as would securing permits.
Meanwhile, big oil companies are spending hundreds of millions of dollars to shift refinery production from gasoline-the fuel most affected by the rise of EVs-to diesel, petrochemicals and lubricants.
Exxon is expected to spend about $2 billion to upgrade its Baytown, Texas, refinery to make more diesel and lubricant base stocks-and less gasoline-starting in 2028. Chevron has a similar, smaller project at its Pascagoula refinery in Mississippi.
Chevron Chief Executive Mike Wirth has suggested his company would continue pivoting toward oil production versus refining over the long term.
"I love our refining business," he told investors last year. "I don't want to say that we would never do something in refining because if it were the right opportunity, we could. But we've long had a view that we want to be a more upstream-weighted company."
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