Energy Security Analysis (ESAI), US-based global energy consulting company, in a report, said more development of the processing volume in the Middle East will keep on realigning global petroleum product markets.
Increments in gasoline, diesel, jet fuel and fuel oil production in the area will change market patterns and keep global refining surpluses from increasing a substantial recovery, according to the company’s prospects,
During the years 2011-2015 consolidated combined production of the five primary items (naphtha, gasoline, jet fuel, diesel and fuel oil) mounted by an annual average 210,000 barrels per day, the ESAI Energy observed
The company anticipates 550,000 barrels per day growth, which is a significant increase as it surpasses demand growth of only 180,000 barrels per day for those items products in 2016.
The report said “The transition of the Middle East refining region into a net exporter of petroleum products has been bearish for global refined product market fundamentals in recent years.”
The Managing Principal of ESAI Energy, Sarah Emerson said, “Oil majors have come under scrutiny for pushing refining units to offset profit losses from low energy prices.”
“However, it may not be the major oil companies who are most influencing the market. In fact, careful analysis reveals that refining margins have fallen not so much because of steps taken by the oil majors, but rather by growing refinery output in the Middle East, India, China all of which have added to their own product supplies and in the process either need to import less from the global market or can now export more to the global market,” she added.
According to ESAI’s report, through 2021, large refinery and condensate splitter projects should be finalised in Iran, Iraq, Kuwait, Saudi Arabia and the UAE, whereas Oman and Qatar will also add volume.
In the period 2017-2021, ESAI Energy expects refining volume growths will steer Middle East manufacture of the five key products to rise by an estimated 355,000 barrels a day annually against average local demand increase of simply 195,000 barrels a day each year.