Downstream - An Eastern Shift

For the downstream oil industry, earth is rotating clockwise, as according to Vienna-based consultancy, JBC Energy, refiners in Europe, N. America may shut 11% capacity by 2013, followed by 19% of capacity taken off-stream by 2020.

On the other hand OPEC Secretary General Salem El-Badri said in the latest OPEC Bulletin, "Over the next decade, members were expected to invest around $40 billion in refining capacity expansion". He added that in 2009, around 30 projects came on-stream in OPEC member countries, resulting in an increase of 1.5 million barrels a day in net crude and liquids capacity. Furthermore, over the next five years 140 projects are expected to be completed and this will add about 12 million barrels a day of gross crude and liquids capacity. "This represents a huge level of investment, estimated at $160 billion. However, it should be enough to satisfy growing demand for OPEC crude, as well as provide a comfortable cushion of capacity, which already exceeds 6 million barrels a day," El-Badri said.

Besides, the two Asian countries, China and India, have considerably expanded their share in the downstream pipe.

The shift is real and certain in otherwise misty global economic climate.