What was their argument for pushing back on that? What was their objection?

Well, you have to look back into history.

So back in 2011 and 2012, the U.S. Atlantic coast lost quite a bit of their refining capacity.

We have no crude oil here on the East Coast.

We don't produce crude oil.

So anything that comes by crude is usually waterborne.

And there's no pipelines either sending crude from other parts of the U.S. where they do produce it.

Do you think that there's, you know, is there room here to grow? I mean, it's not going to happen overnight, but biofuels production?

What was their argument for pushing back on that? What was their objection?

Well, you have to look back into history.

So back in 2011 and 2012, the U.S. Atlantic coast lost quite a bit of their refining capacity.

We have no crude oil here on the East Coast.

We don't produce crude oil.

So anything that comes by crude is usually waterborne.

And there's no pipelines either sending crude from other parts of the U.S. where they do produce it.

Do you think that there's, you know, is there room here to grow? I mean, it's not going to happen overnight, but biofuels production?

Uh, they must be pretty stoked.

So the Q2 two thousand and six delivered some of the strongest refining margins in a generation, right? And as you, uh, mentioned before, the Strait of Hormuz disruption, Russian diesel export bans, a constrained Chinese product export, um, you know, markets have created a perfect storm of global supply tightness that US Gulf Coast refiners are uniquely positioned to exploit.

And, uh, you mentioned some of them, uh, you know, Marathon's net income, Marathon being the largest US refiner, quadrupled to five point one billion in Q2, right? Um, ExxonMobil posted record diesel output.

They've worked hard on integrating their US, uh, Gulf Coast system.

But anyway, despite planned maintenance at two, two of their big plants, they ran at ninety-five percent reliability and po- and, and again, with diesel exports record levels.

Phillips sixty-six captured ninety-eight percent of the market indicator as the benchmark cracks reached, reached about seventy dollars per barrel, which they described as the highest on record.

And, um, our colleagues at S&P Global Energy, um, look at this as a stronger for longer margin environment, and they actually have updated their, uh, outlook by adding about three dollars per barrel to the LLS, the Light Louisiana Sweet cracking margin, through two thousand twenty-seven to two thousand thirty.

So you've got like in July, something like two-thirds of Venezuelan crude exports as heavy crude, total crude exports was going to the US.

Yeah

... right? And in this, and in the PADD one-C, you know, which is Virginia down south, they get it from the Colonial Pipeline, right? Very little from the Colonial Pipeline makes it up to the harbor f- at least for, you know, for gasoline and diesel mostly.

So, so we, we're in the Middle Atlantic states, and so California thought, "Hey, that sounds good.

Let's do that." And again, it's, it's, it's worked quite well, you know, in, in here in the US, um, Atlantic Coast, but their timing was off because, you know, now, you know, they didn't-- Who, who expected that South Korea, who was all geared up and ready to go to supply the market, they've, they've upgraded their plants, their logistic.

They liked it.

It was gonna work well.

Who-- But no one saw this like, I guess, black swan event that threw the wrench into the import.

Mm-hmm