Development Status and Prospect of Global Oil Refining Industry

In 2021, the COVID-19 pandemic continued to spread, causing most refinery projects to be delayed and a wave of refinery closures continues globally, resulting in a net reduction in the world refining industry, instead of the growth momentum that has been sustained for years. Preliminary estimates suggest that approximately 1.61 million barrels per day of global refining capacity was permanently shut down in 2021, resulting in a net reduction of refining capacity of 1.08 million barrels per day. Refinery processing revenue and major oil crack spreads have rebounded in the world's three major refining centers, driving processing volumes to high levels, but refining capacity is limited. In 2022, as the impact of the pandemic gradually recedes, the world's new refining capacity returned to normal year levels, and the incremental volume is expected to expand significantly compared with 2021, reaching about 2.36 million barrels per day, with developing countries in the Asia–Pacific and Middle East regions becoming the main force of refining capacity growth. The macroeconomic recession in 2022 and the Russia-Ukraine conflict have led to sharp shocks in the world energy market, and gross refining margins are therefore highly volatile, basically rising month by month to reach historical highs, but traditional energy is still a scarce resource in the short term. In the medium and long term, the carbon neutral process will profoundly change the development of the refining industry, and the green and low-carbon transformation process may be accelerated.