Refineries will have to cut production, says Merrill

Refineries will have to substantially under utilise their capacity in 2009 as demand for petrol, diesel and other refined product subsides, Bank of America subsidiary Merrill Lynch has said in its new report.

Interestingly, the countries that will suffer due to this are not the oil producing states.

Merrill Lynch said the refineries in countries like India, China, the United States and Vietnam in 2009, many of them government run, will bear the brunt of low profits on refined crude.

The situation will acerbated by additional refining capacity coming online in 2010 and by new biofuel supplies into the markets, it said.

Emirates Business 24/7