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Diesel fuel demand to drive global refined product demand and margins

In the aftermath of the global recession, diesel fuel demand will rebound and again drive global refined product demand and margins, according to a new global report released by Hart Energy Consulting. Low sulfur diesel markets will strengthen and remain strong for the foreseeable future.

Gasoline demand will experience significant reductions in the Atlantic markets, as vehicle economy standards are implemented and biofuels continue to penetrate the market. Excluding the ethanol contribution, gasoline demand for Europe plus North America will decline 20% from peak 2007 levels by 2020. By 2030, gasoline demand (less ethanol) will be more than 37% below 2007.

Refineries in Europe and North America will face tough challenges in reducing gasoline yield and meeting diesel needs, dictating refinery reconfiguration and rationalization. Speaking about changes in regional trends, Terrence Higgins, Executive Director, Refining & Special Projects, Hart Energy Consulting, noted “Gasoline growth will shift from the Atlantic markets to Asian and Middle East regions. However, even these markets are less promising as natural gas substitution and prospects for reductions in fuel subsidies will constrain growth in some developing markets”.

Expanding economies in China, India and the Middle East will make up a large portion of the gasoline demand reduction in the Atlantic market. But the report reveals that longer term these high-growth areas will see demand growth falling from 7+% annual rates to less than half this growth.

The full report covers:

Country-specific, regional and global production data for crude and NGL, refined product quality and supply to 2030
Key focus on the growth of China, and increasing demand in Asia Pacific and the Middle East
Supply and demand, by sulfur limit, for gasoline, naphtha, jet fuel, kerosene, diesel, distillate, marine and residual fuel
Impact analysis of production, environmental and CO2-related policy requirements on transportation fuel quality
Analysis of Europe’s need for high cetane diesel and its suppliers
Key focus on Brazil’s ability to increase crude supply, and output of refined products and advanced biofuels
Short and long term crude & refined products pricing and margin analysis

For more information on the study findings, methodology and geographical coverage, Terrence Higgins is available for comment at +1.703.891.4815 or thiggins@hartenergy.com

Hart Energy Consulting is a division of Hart Energy Publishing, LP, a leading provider of specialized data/information products and member-only services to targeted audiences worldwide and of news, data and analysis for the global energy industry. Its core publishing and consulting expertise has been extended to online products (databases, maps) and services (web sites, market information) as well as industry conferences and exhibitions. Hart Energy clients derive from the energy industry, the financial and investment community, engineering and automotive industries, utilities, leading NGOs and the world’s major governments.

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