COVID-19 Shutdowns Slash Demand for Refined Products
By Scott Jenkins, Chemical Engineering magazine |
Demand for refined products has dropped sharply, challenging petroleum refineries with compressed margins, but a deal was struck on global production cuts
The large-scale shutdown of economic activity related to the global pandemic response has caused demand for refined petroleum products to plunge dramatically, placing refiners around the world into a difficult situation. Refinery production cuts are common, while some plants have been idled.
“In countries where stay-at-home orders and social distancing measures have been issued, gasoline demand is down by 50% and aviation fuel demand is down 70% or more,” says Steve Sawyer, director of refining for Facts Global Energy (FGE; London, U.K.; www.fgenergy.com). “Diesel demand has kept up a little better because trucking deliveries are still being made, but despite that, diesel has fallen by 30% at least.” Sawyer adds “Really, demand for all hydrocarbons coming out of a refinery are down.”
Sawyer says April demand for refined products could be 23 million barrels per day (bbl/d) lower than the corresponding value from April of last year. “May could maybe be a bit better, but if you’re in a deep hole, and you take one step up, you are still in a deep hole.” Weak demand…