Photo Credit: Courtesy of Helmerich & Payne, IDC
Covid-19 accelerates changes in global refining landscape.
At the start of 2020, the focus of the global shipping and refining
industry was on the implementation of IMO 2020. What would be the
winning fuel and which refiners were best positioned to make it? Now, as
we are approaching 2021, the conversation has changed dramatically, and
so has the refining landscape.
The demand shock caused by Covid-19 has hit the industry hard and it has accelerated the rationalization of the global refining business. Overall, global capacity is still growing, albeit at a slower pace than was planned pre-pandemic. In some regions of the world (mainly in the developed countries) refinery capacity is being closed, but expansions are still being planned in developing countries in Asia and the Middle East.
The implications for the product tankers industry can be significant, depending on overall demand growth and regional product balances and refining economics.