Delta's Refinery Woes

Discussion in 'Delta Air Lines' started by eolesen, Aug 14, 2020.

  1. eolesen

    eolesen Veteran

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    It's days like this that I miss WT being around.

    https://www.nytimes.com/2020/08/10/business/energy-environment/delta-oil-refinery-jet-fuel.html


     
  2. jimntx

    jimntx Veteran

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    Just goes to show that the best course of action is to stay in your own lane. If you are really good at flying people and goods around the nation and the world, maybe you should just do that.

    The largest profits in the oil bidness (sp) come from vertically integrated operations such as the major oil companies have. They control their product AND production stream from drilling to refining to pumping gas at the 7-11. Think of the jet fuel pumping to be a really high quality 7-11. When Delta bought the refinery they took control of one small part of the operation which is dependent upon factors totally beyond Delta's control. I guess they thought there would never be a time when more jet fuel was not needed. Oil company operated refineries can easily switch from jet fuel to other refined products. With just one refinery, Delta couldn't produce enough other product to make it profitable.

    Considering that being an oil company used to be viewed as a license to print money, I would be interested to know why the refinery was for sale in the first place.
     
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  3. Kev3188

    Kev3188 Veteran

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    Lol. No thanks.

    Exactly. Vertical integration can lead to profits in many industries. One only needs to look at what Amazon is doing w/supply chains to see that in action.

    Interestingly (or not), we haven't heard much at all internally about Trainer lately. They have talked about vertical integration as part of the recovery path, but couch it terms like "insourcing," and "cross-divisional flexibility."
     

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