Global Refining Capacity of 3.6mb/d at High Risk of Closure: Woodmac

More than a fifth of global oil refining capacity is at risk of closure as gasoline margins weaken and the pressure to reduce carbon emissions increases, according to Wood Mackenzie.

• As much as 3.6mb/d of global refining capacity is at high risk of closure, of which 45% are based in Europe.
• In total, 21% of the 2023 total global refining capacity, equalling 19.95mb/d is at some risk of closure.
• “The European refinery sector will come under pressure in the mid-term as gasoline margins weaken and pressure to decarbonize increases,” said Emma Fox at Wood Mackenzie.
• “This will impact operating costs to such a degree that closure may be the only option.”
• The eleven European refineries identified as high-risk are mostly standalone catalytic cracking sites and spread across the continent.
• There are seven high-risk independent facilities in China. The independent assets will suffer from the threat of competition against larger integrated sites.
• Facilities could improve competitiveness with investment in decarbonisation due to future carbon taxes.