According to ‘ESAI Energy’s June Global Refining Outlook’, The Former Soviet Union countries (FSU), Latin America, Europe and Africa will add more than 360 000 bpd of coking and solvent de-asphalting capacity between July 2015 and end of 2017. In the past, heavy residue upgrading capacity has been added mainly in North America, Asia and the Middle East.
Meanwhile, the FSU, Latin America, Europe and Africa have remained significant fuel oil producers and exporters, accounting for roughly 50% of global fuel oil production in 2015.
“New heavy fuel oil upgrading investments in these regions will lower fuel oil production by as much as 300 000 bpd and raise heavy sour crude demand by more than 200 000 bpd by the end of 2017” says Chris Barber, ESAI Energy’s Refining Analyst. “These traditional heavy residue and fuel oil exporters are building to process difficult feedstock, but have gone under the radar because they are not in the US, Asia or the Middle East,” continues Barber.
These developments on the margin of the heavy oil markets will support fuel oil and heavy crude prices, narrowing fuel oil spreads and containing heavy crude differentials.
Adapted from press release by Francesca Brindle
Read the article online at: https://www.hydrocarbonengineering.com/refining/23062016/esai-energy-projects-heavy-crude-demand-to-rise-as-coking-capacity-increases-3573/