Goldman Sachs analysts have tightened their forecasts for the global oil refining market, pointing to a growing supply deficit. The reasons for this are military conflicts in the Middle East and the confrontation between Russia and Ukraine. The bank's experts have also raised profitability estimates for diesel fuel production, more than doubling them. This is reported by Bloomberg.
The report notes that a wave of strikes by workers at oil refineries in the Middle East and Russia has further deepened the already complex situation of global oil refining capacities. This, in turn, has led to an increase in margins for oil products.
“Diesel fuel continues to remain in the spotlight due to its high demand,” the report emphasizes.
According to experts' calculations, the current idle capacity of oil refineries exceeds seasonal standard indicators by 60%. At the same time, stocks of finished products are decreasing, although demand for them is also declining. Analysts forecast that next year the average profit from refining a barrel of diesel fuel, above the price of Brent crude oil, will be $63 in the U.S. and $49 in the European Union. For comparison, it was previously expected to be $27 and $19, respectively.
The global economy is facing a fuel crisis, during which the prices of gasoline and other types of oil products are rising significantly faster than the value of crude oil. The situation could worsen after Russia extended its ban on diesel fuel exports until September, as well as due to increased consumption in Brazil. Brazil ranks second in the world in terms of fuel import volumes. An additional pressure factor will be the expected winter in the Northern Hemisphere, which will increase the demand for heating fuel.
As for the Middle East, oil exports from the Persian Gulf region have likely recovered to 70-80% of pre-war levels. However, supplies of finished oil products from the region still account for about 40%.
“A full recovery requires a reduction in global geopolitical tensions,” the report concludes.
