European oil refineries to undergo restructuring

Collapse of global oil demand caused by the coronavirus pandemic has intensified talks over restructuring of European refineries. Some of them have been facing bankruptcy problems for some time and coronavirus has revealed their existential problems.


Before the coronavirus pandemic was at its strongest, many analysts pointed out to the need of destructuralization a capacity rationalization of European oil refineries. Consulting company Woodman is endangered in up to 9% of their capacities, which will have to be rationalized between 2022 and 2023. 

Woodman has not mentioned any names of oil companies, but it will probably be those disposing of old refineries. Some talk about capacities in Rotterdam, French refinery Grandpuits or Scotch Grangemouth. Gunvor, a company trading energy commodities, has recently mentioned a possibility of getting rid of unprofitable refineries in Belgium.  

Goldman Sachs reported that global usage of oil refiners will drop up to 3% from 2021 to 2024, compared to last year’s values. Majority of the decline will concern Europe, where refineries experienced rationalization in 2009 crisis. However, other parts of the world expect rather growing capacities of oil processors in upcoming years. 


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