Oil refining capacity fell for first time in 30 years in 2021, IEA says

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LONDON, Jan 19 (Reuters) – Global oil refining capacity fell for the first time in 30 years last year, as new capacity was outweighed by closures, the International Energy Agency said in its monthly oil market report on Wednesday.

Refining capacity was down by 730,000 barrels per day (bpd) in 2021, the IEA said, but net additions were expected to amount to 1.2 million bpd in 2022.

Global runs are forecast to rise by 3.7 million bpd in 2022, the IEA added. Refinery throughput averaged 79.8 million bpd in the fourth quarter of 2021, it added.

Over the last two years, about 900,000 bpd of refining capacity in Asia (excluding China) has been either shut or scheduled to permanently close before the end of 2022, the IEA said.

Oil supply will soon overtake demand as some producers are set to pump at or above all-time highs, the International Energy Agency (IEA) added, while demand holds up despite the spread of the Omicron coronavirus variant.

“This time around, the surge is having a more muted impact on oil use,” the Paris-based IEA said in its monthly oil report.

“The steady rise in supply could see a significant surplus materialise in 1Q22 and going forward,” it said, with the United States, Canada and Brazil set to pump at all-time highs for the year while Saudi Arabia and Russia could also break their output records.

(Reporting by Noah Browning; editing by Jason Neely)

Photo by Timon Studler on Unsplash

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