Hoy es el día más hermoso de nuestra vida, querido Sancho; los obstáculos más grandes, nuestras propias indecisiones; nuestro enemigo más fuerte, el miedo al poderoso y a nosotros mismos; la cosa más fácil, equivocarnos; la más destructiva, la mentira y el egoísmo; la peor derrota, el desaliento; los defectos más peligrosos, la soberbia y el rencor; las sensaciones más gratas, la buena conciencia, el esfuerzo para ser mejores sin ser perfectos, y sobretodo, la disposición para hacer el bien y combatir la injusticia dondequiera que esté.
MIGUEL DE CERVANTES Don Quijote de la Mancha.
22 de marzo de 2016
How to Squander an Oil Glut
The
world uses about 95 million barrels of oil a day. But oil refiners see a
world using only 82 million barrels a day. That's a lot of missing oil.
Before
any oil bulls start looking for the nearest window ledge, that demand
is still there. It just isn't met by oil refiners. Last year, 13 million
barrels a day of demand was satisfied by a combination of biofuels,
direct burning of crude oil, and by-products of natural gas production
such as liquefied petroleum gases and ethane, according to data from the
International Energy Agency. These bypass refineries.
It's an
important distinction to make because, similar to the oil production
business, global refiners are at risk from a supply glut of their own.
There's little sign of that now, at least among the U.S. refining stocks.
Cheap oil kills E&P companies,
but refiners love it, provided the problem is one of excess supply
rather than sagging demand. Last year was definitely a case of the
former. Oil consumption surged by 1.6 million barrels a day, with around
80 percent of that being refined products, especially gasoline as
drivers took their cue from lower pump prices. That almost mopped up the
entire increase in global refinery capacity of 1.33 million barrels a
day. Refining margins jumped, even in the typically weak European
market.
This year, capacity additions are low; the IEA expects
just half a million barrels a day extra. With global consumption
of refined products projected to rise by 900,000 barrels a day, that
means demand will outstrip new refinery supply for the first time since
2013. Even so, the chart below looks pretty ugly from a refiner's
perspective:
Over the past decade, global oil demand rose by about 10
million barrels a day. But demand for refined products rose by just
half that, while capacity increased by 8.7 million barrels a day.
Looking
ahead, while demand is projected to rise by 5.9 million barrels a day
through 2021, an extra 7.7 million barrels a day of net new refining
capacity is expected to switch on. So after dipping this year to 3.6
million barrels a day, excess refining capacity could hit 5.3 million
barrels a day by the start of the next decade. Most of the new capacity,
almost three-quarters, is due to start up in Asia and the Middle East,
aimed at satisfying growing local demand but also geared toward exports.
That
will weigh on refining margins, with European operators particularly
exposed. This slide from a recent presentation by Kristine Petrosyan of
the IEA shows why Europe is already a dumping ground for the world's
surplus diesel (the figures show how much of a diesel deficit or surplus
each region had last year, in thousands of barrels a day). This, along
with the mild winter, pushed stocks of distillate in Europe to a
seasonal record in December.
U.S.
refiners are better positioned but not immune. Distillate inventories
stateside are also above the upper limit of the seasonal range. Apart
from being just another blob in the glut,
that means refiners need even higher gasoline margins to offset the
weaker pricing in diesel. How much? Gasoline spreads would need to rise
by 28 percent compared with last summer for a typical refiner to have
the same profit overall, according to Credit Suisse. And as the next few
years progress, U.S. export refineries will be competing in an
increasingly oversupplied international market.
One saving grace
could be the same thing that made 2015 such a banner year: low oil
prices. Cheap crude would help preserve margins while also encouraging
demand.
In addition, if the current rally in oil fades or
stabilizes at a low level, it is a fairly safe bet that at least some of
the money earmarked for new refineries the Middle East, the rest of
Asia, and South America won't turn up. A big increase in demand would
float all boats. Failing that, refiners could live with low oil prices
keeping their suppliers weak and new rivals out.
This column does not necessarily reflect the opinion of Bloomberg LP and its owners.
