PETALING JAYA: Despite implementing massive capacity additions, Asia-Pacific’s oil and gas refiners have been largely unsuccessful in reducing imports and, ultimately, offsetting demand growth, according to international management consulting firm Bain & Company.
Based on the firm’s latest report – Full potential for oil refiners in a challenging environment – over the next few years, global refiners would have to cope with several long-term challenges.
These include a global supply of crude that is becoming more difficult to refine, new refineries coming online that could boost capacity beyond demand for refined products, and more stringent regulations that will force developing markets to catch up with their developed counterparts.
Some segments and refiners, the firm said, would be impacted by these global trends more so than others, adding that this would create competitiveness differentials for the different groups of refiners.
“These global trends will affect the entire refining sector, but when we looked at key competitiveness factors – market, operating conditions and quality of asset portfolio – we found that some countries are better positioned than others to thrive over the next decade,” said Francesco Cigala, a partner in Bain’s oil & gas practice based in Kuala Lumpur.
According to Bain’s analysis, Asia-Pacific independents, Middle East national oil companies (NOCs), and the Commonwealth of Independent States lead the pack. Africa and Latin America NOCs and EU Independents are quickly falling behind, it pointed out.