Billionaire Steyer Highlights Exports in Anti-Keystone Ad - Bloomberg
“Foreign countries will get more access to more oil to make more products to sell back to us, undercutting our economy,” Steyer, founder of the hedge fund Farallon Capital Management LLC, says in the advertisement. “Here’s the truth: Keystone oil will travel through America not to America.”
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Oddly enough, Tom Steyer is right to a degree on this one. The Keystone XL will bring crude to the Gulf coast where it will be refined. The refined products will be sold back into this country but also into the world market. Look also at the price of WTI crude (domenstic/North Amrerican) vs. Brent Crude. 5-10 years ago, the difference was 1-2%, currently it is 8% and its been as high as 25%. Low cost transport of crude from Canada (and North Dakota) will reduce these differences. Remember however, crude oil is used mostly for transportation fuels. Natural gas on the other hand, is truly a regional fuel as it is very expensive to transport because it has to be liquified cryogenicly. It is a much more important fuel for business and commerce as its a common feedstock in plastics and is becoming a primary fuel for power generation. An upgraded pipeline network will allow the excess gas produced in North Dakota to find its way into the national distribution network and this will keep a lid on natural gas prices which will be a much bigger benefit to the economy.
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