Most of the near term attention in the oil markets is appropriately being focused on US war preparations with Iraq, but US marketers and end-users of gasoline, diesel and jet fuel can expect some non Iraq-related supply scares for refined products as early as this Winter.
A recent series of articles by Oil Price Information Service (OPIS) reveals that regulatory changes that will be phased in over the next 40 months may forever alter the economics that dictate how fuel is made, bought and sold in US markets.
This week, for example, OPIS notes that the Autumn refinery maintenance schedule which commences later this month represents the last "normal" period of downtime for the US refining industry.
OPIS finds that a lighter than normal schedule of downtime will be implemented for major refiners which include ExxonMobil (XOM), ConocoPhillips (COP), BP (BP), Amerada Hess (AHC), Shell (RD) and Sun (SUN). Meanwhile, a mixture of light refinery work has been supplemented by some hefty run cuts among independents such as Valero (VLO), Tesoro (TSO), Premcor (PCO), and Frontier (FTO).
Critical work on the US refining infrastructure in 2003 will see many refineries idled for twice the time in previous years, with the possibility that such downtime may have two or three times the impact seen during other years.
But even before this ambitious reconfiguration for refining commences, US markets may be impacted by the closure and sale of refineries that may not merit the hundreds in millions of dollars in upgrades necessary to meet mid-decade Clean Air regulations.
Some special forums on the subject of US oil supply will be covered by industry experts at the OPIS National Supply Summit on October 24-25, 2002 at the Westin La Cantera Resort in San Antonio, Texas. More than a dozen sessions on critical supply topics will be covered, including a lively panel discussion on how new lower sulfur fuels will revolutionize the way products are shipped and stored in all fifty states.
A special keynote session by Citgo Senior VP & President of the NPRA, Jerry Thompson, kicks off the annual Summit attended by top oil execs for oil companies, airlines, fleets, trading houses, refineries, travel centers, terminals and pipelines. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
