European refineries struggle to stay afloat | 2013-06-17 | Processing Magazinehttp://www.processingmagazine.com/articles/125750-european-refineries-...

European refineries struggle to stay afloat

June 17, 2013 No Comments Share Share Email / Print / Reprints / Share | More / Text Size+

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According to a recent analysis by Platts, European refineries are losing ground to their counterparts across the Atlantic, where the U.S. refining sector is flourishing thanks to its access to cheap and abundant feedstock produced from unconventional oil. All this is adding to the already subdued demand for European production and continues to pose a threat to the existence of European refineries. Many experts predict that there will be further closures in the sector, especially as huge superscale refineries continue to emerge internationally. The current state of the industry was discussed at a recent event held in Barcelona, where Antoine Halff, head of the oil industry division at the International Energy Agency (IEA), confirmed what has become quite obvious -U.S. refineries have been brought back to life, while a big proportion of the European refinery sector is on the verge of collapse. In the past, surplus production from refineries in Europe used to be shipped to the United States but this is now nearly impossible as U.S. refineries are benefiting immensely from shale oil and gas production that has brought costs down and has allowed them to reduce their dependency on imports. This leaves European refineries with very few options, commented Nick Vandervell, director of the UK's downstream oil industry association UKPIA. RELATED: Total to modernize Antwerp refining and petrochemical platform

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As an extra challenge, countries across the world are trying to catch up with the U.S. refining sector, which further limits the opportunities for European refiners. For example, Brazil has announced plans to increase and upgrade its own production in an attempt to meet rising domestic demand. Other Latin American countries which have relied on imports from Europe in the past are now looking towards North America for supplies. 6/18/2013 11:24 AM