OPEC Says Refiners May Cut Operating Rates on `Poor’ Margins

(Bloomberg) — Refiners around the world may cut operating rates in the coming months, reducing crude oil demand, because of “poor” margins, the Organization of Petroleum Exporting Countries said.

“The recent strong builds in gasoline stocks in the U.S. and elsewhere should cause the poor performance of refinery economics and encourage refiners to trim crude demand and refinery throughputs,” OPEC said today in its monthly report.


Refiners using Brent in their plants in northwest Europe earned 21 cents a barrel yesterday, compared with $4.65 a barrel on Feb. 21, according to data compiled by Bloomberg. The decline in refining margins, or the profit from turning a barrel of oil into fuels such as gasoline and diesel, reflects the failure of product prices to keep pace with rising crude.

“A combination of slowing demand for middle distillates, gasoline stocks building across the globe, especially in the U.S., and high crude oil prices may limit the impact of seasonal refinery turnarounds on refining margins in the coming months,” analysts including Safar Keramati said in the report.

Bloomberg