Do note that this is a refinery, not a new oil discovery. With prices where they are, companies would rather put their scarce resources in to raw oil production than in to refinery capacity.

The cost of oil exploration has ballooned considerably in recent years due to the rush of so many companies going out to explore new potential oil fields. This has put a strain on both available personnel and equipment (drilling rigs). While there is still a very lucrative return available at $145 oil, the risk is that after spending a few $billion on exploration and getting the oil flowing to the market, they will force an oversupply situation and the price of oil will drop below what it cost them to develop the fields in the first place. Sound familiar? As we know all too painfully, the time between exploration/discovery and production can see commodity prices change a lot. Brazil's offshore Tupi field won't be in to production until 2010/2011 at earliest. Their Jupiter field is over 15,000 feet down... it won't be cheap to get at that oil!

That said, the recent run-up in oil prices has elements that are unique to oil itself. The first being that global oil production may be peaking (or close to peaking, it might have one last gasp left). We aren't finding enough new production to replace older fields that are declining and we may find, despite our best efforts to drill like mad, that global oil production will slowly decline from this point going forward. Second, there has been a flood of money going in to various commodities (hello, gold!) as a hedge against inflation... and we may only be seeing the beginning of this. Things do not look good out there.