The recently issued World Oil Outlook report by Opec comes at a time when the oil refining industry is passing through many changes around the world.
While the refinery distillation capacity is stagnant in the US, it is faced with sale or closure of in Europe but more than compensated by an enormous expansion in Asia and the Middle East.
Oil demand in the US is down or stagnant at best while a reduction in oil demand is already a fact in Europe. Therefore, between 2008 and 2011 two million barrels a day (mbd) of refining capacity is closed for good and only in 2011 and so far in 2012, 1.7mbd is closed in Europe alone. The relatively low capacity refineries and those without adequate conversion capacity are those destined for closure as their economy becomes untenable and to allow other refineries to operate at higher utilisation rates to improve their profit margin.
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