Bloomberg
China has been a U.S. power since the 19th century. Will take the oil-refining crown held by
(Bloomberg) – Earlier this month, Royal Dutch Shell plc pulled the plug on its convent refinery in Louisiana. Unlike many oil refineries that have closed in recent years, the convent was far from obsolete: it Is fairly large by standards and tidy enough to convert a wide range of crude oil into high value fuels. However, Shell, the world’s third-largest oil producer, wanted to radically reduce its refining capacity and could not find a buyer. The 700 workers at the convent found out they were out of work, firing on their counterparts across the Pacific. New unit in Rongsheng Petrochemical’s huge Zhejiang complex in northeast China. It is just one of at least four ongoing projects in the country, equivalent to the UK’s entire fleet of 1.3 million barrels a day of crude-processing capacity. The Covid crisis has shifted the seismicity in the global refining industry as demand for plastics and fuel increases in China and the rest of Asia, where economies are rapidly recovering from the epidemic. In contrast, the U.S. And refineries in Europe have been reeling from the economic crisis while the transition from fossil fuels has slowed the long-term outlook for oil demand. The refining pack has been on top since the beginning of the oil era in America. In the mid-nineteenth century, but according to the International Atomic Energy Agency, China will lose power to the U.S. early next year. In the year 166767 the Convent opened, U.S. China had 35 times the inning purification capacity. Together with many large new plants in India and the Middle East, China’s refining industry is booming through the global energy system. Oil exporters sell more crude in Asia and less to longtime customers in North America and Europe. And as they increase capacity, China’s refiners are becoming a growing force in international markets for gasoline, diesel and other fuels. It is also putting pressure on older plants in other parts of Asia: Shell also announced this month that they would halve capacity at their Singapore refinery. This parallels the growing dominance of China’s global steel industry in the early part of the century, when China built a clutch of huge, modern mills. To meet growing domestic demand, they also made China a force in the export market, accepting low-cost producers in Europe, North America and other parts of Asia and forcing them to shut down aging, inefficient plants. “One million barrels a day or more on the table over the next few years,” said Steve Sawyer, industry consultant at Facts Global Energy, or FGE’s refining director. China is likely to overtake the US in the next year or two. “Asia Risingbut is China, India and the Middle East when capacity increases. It may take years for oil demand to fully recover from the damage caused by the coronavirus. Will push several million barrels a day.IAA reports that more than half of these shutdowns have occurred in the U.S..Almost two-thirds of European refiners do not make enough money to cover their costs in fuel production, according to IHS ‘Europe-CIS refining “Europe still needs to reduce its daily processing capacity by a further 1.7 million barrels in five years,” said research head Heidi Greti. “There is still a long way to go. China’s refining capacity has nearly tripled since the turn of the millennium as it seeks to keep pace with rapid growth in diesel and gasoline consumption. According to the nstitute G Research Institute, the country’s crude processing capacity is expected to reach 1 billion tonnes a year, or 20 million barrels per day by 2025, according to the China National Petroleum Corp.’s economics and technology research institute. Is increasing, including 1.2 million barrels per new mega project. Middle Eastern producers are adding to the excitement, building new units with at least two projects worth more than ten million barrels a year that will begin operations next year. Plastic Drive The use of fan drivers for new projects is increasing the demand for petrochemicals. To make plastic. According to industry consultant Wood McKenzie, more than half of the incoming refining capacity will be added to Asia from 2019 to 2027, and 70% to 80% of this will be plastic concentrated. Integrated refineries are gaining popularity in Asia. The region has a relatively fast economic growth rate and the fact that it is still a net importer of feed stocks such as naphtha, ethylene and propylene as well as liquefied petroleum gas, which are used to make a variety of plastics. U.S. Is the largest supplier of naphtha and LPG in Asia. This new large and integrated plant makes life more difficult for their smaller competitors, who lack their scale, the flexibility to switch between fuels, and the ability to process deer, cheaper crude. Refineries are closing. According to Lan Lan Gallader, vice president of refining and oil markets at Wood Mackenzie, the 1960s were relatively small, very practical and not generally built. It sees an additional capacity of about 3 million barrels a day. “In order for them to survive, they will need to export more products as their regional demand declines, but unfortunately they are not very competitive, which means they are likely to close.” Demand Trap Global oil consumption is on track to fall by unprecedented. I.A.A. According to, this year is 8.8 million barrels a day, averaging 31.3 million, which is expected to be less than two-thirds of this lost demand to be recovered next year. Globally, some refineries had shutters set up just before the epidemic hit. According to the IEA, crude distillation capacity of about 102 million barrels a day from 84 million barrels of demand for refined products in 2019. “There was a sudden shock, expecting a long, slow adjustment,” said Rob Smith, director of IVS Markets. U.S. There are pressure rules for biofuels. He encouraged some refiners to re-employ their plants for biofuel production. The increase in capacity leaves its demand growth behind. CNPC According to Na, the country’s oil production could reach 1.4 million barrels a day in 2025. Even when new refineries are built, China’s demand growth is expected to increase by 2025 and then the country is slowly beginning its long transition to carbon neutrality. “In an environment where the world already has enough purification capacity, if you build more in one part of the world, you need to close something in the other part of the world to maintain balance,” said FGE’s Sovereign. “It’s the kind of environment in which we We are now and are likely to stay for at least the next 5 years. ” For more articles like this, please visit our Bloomberg.com subscribe now to move forward with the most trusted business. News Source. 20 2020 Bloomberg LP
