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How Dispersed Are Refining Capacities Globally?


Nov. 14 2016, Published 3:02 p.m. ET

Distribution of refining capacities globally

In 2015, the global refining capacity was 97.2 MM bpd (million barrels per day), of which 34% was located in Asia-Pacific. China accounted for 15% while India held 5% of worldwide refining capacity in 2014, and so 20% of all global refining capacity is located in these two countries alone. Notably, neither China nor India produces the amount of oil required by their refining capacities, which means that they have to import large quantities of oil.

Specifically, India imports mainly from the Middle East, West Africa, and South and Central America, whereas China sources crude oil mostly from the Middle East. Europe is also a significant importer of crude oil, while the Middle East is the largest exporter.

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Refining capacities in Europe and the US

Europe and Eurasia contribute 24% of the world’s refining capacity, and Russia is the largest capacity contributor to the region, accounting for 7% of global refining capacity. The remaining capacities are scattered around in the area.

Larger integrated energy player’s like ExxonMobil (XOM) and BP (BP) have refining capacities worldwide. ExxonMobil has 33% of its refining capacity in Europe, while BP has 46% of its capacity in Europe.

North America accounts for 23% of global refining capacity, with the US accounting for 19% of worldwide capacity. Chevron (CVX) has almost half of its refining capacity in the US, which also houses pure downstream companies, or independent refiners, like Marathon Petroleum (MPC), Tesoro (TSO), Valero (VLO), and Phillips 66 (PSX). The majority of these companies’ refining activities take place in the US.

For exposure to refining sector stocks, you can consider the iShares US Oil & Gas Exploration & Production ETF (IEO). The ETF has ~21% exposure to oil and gas refining and marketing companies.


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