A global refining capacity shortage is predicted for next year due to potential refinery closures driven by low margins.
A refining capacity shortage is looming globally and could materialize as soon as next year, the chief executive of Phillips 66 told Bloomberg in an interview. The potential shortage would be triggered by capacity shutdowns, Mark Lashier said, as some refiners succumb to low refining margins. The closures could take 700,000 bpd off the market, he added. “The US has become very competitive in refining,” Lashier said. “We’re able to compete out in the world global markets.
Valero Energy would be reducing its operating rate from 3 million barrels daily to 2.86 million bpd. This is the lowest processing rate in two years. Phillips 66, for its part, was planning to cut processing rates to the low 90s in terms of capacity, which would be down from 98% in the second quarter—the highest in five years.
Global Shortage Oil Market U.S. Refiners Production Cuts Fuel Supply Demand Margins Phillips 66 Marathon Petroleum
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