Oil refining a miserable business, according to the Economist
Former NDP MLA David Schreck just tweeted a link to this recent article in the Economist about the oil-refining business, appropriately titled "Stormy Petrol".
Here's an excerpt:
Refining has long been a miserable business. In the 1970s oil companies thought that the world’s thirst for fuel to power big cars would rise forever and built the refineries to match that prediction. But oil demand in the rich world has peaked and is falling, leaving the industry with massive overcapacity.
At the same time competition from the Middle East, China and India is intensifying. Their big, new refineries outperform older ones in Europe and America, despite much investment in upgrading over recent years. Refined fuel can be shunted around the world as readily as crude—and trade in it has increased steadily.
The capacity glut is causing casualties on both sides of the Atlantic.
Of course, Chinese president Hu Jintao or the notorious Koch Brothers could hustle up enough money to ensure that a refinery could still be built in Kitimat.
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