Covid-19 accelerates refinery rationalisation
Significant regional changes hurried along by the pandemic will permanently alter global dynamics
Global refining capacity looked over-supplied even before the Covid-19 pandemic, with projections of capacity growth exceeding increases in refined product demand by a factor of 2:1. New capabilities in the Middle East and Asia are the major driver of this mismatch. But any demand projections made before 2020 have now been summarily torn up, following the collapse in refined product demand due to coronavirus lockdowns and significant uncertainty over whether or if requirements will return to pre-pandemic levels. Refinery throughput reductions have been substantial globally in 2020 but have varied by region. In the US, refinery utilisation rates dropped as low as 68pc in April before recover
Also in this section
7 August 2025
The quick, unified and decisive strategy to return all the barrels from the hefty tranche of cuts from the eight producers involved in voluntary curbs signals a shift and sets the tone for the path ahead
7 August 2025
Without US backing, the EU’s newest sanctions package against Russia—though not painless—is unlikely to have a significant impact on the country’s oil and gas revenues or its broader economy
6 August 2025
Diesel market disruptions have propelled crude prices above $100/bl twice in this century, and now oil teeters on the brink of another crude quality crisis
5 August 2025
After failed attempts to find a buyer for its stake in Russia’s largest oil producer, BP may be able to avoid the harsh treatment meted out to ExxonMobil and Shell when they exited—and could even restart operations if geopolitical conditions improve
