"The year 2017 saw growth in the effectiveness of domestic oil refining – the depth of refining grew from 79% to 80-82% in 2016. This was achieved due to a 10% reduction in the production of fuel oil as compared with the 2016 figure," reported the Analytical Center expert Svyatoslav Pikh, speaking at the fourth conference on oil refining and the petrochemical industry "Downstream Russia 2018".
According to Mr Pikh, the most important tendencies of development in domestic oil refinery today are growth in the production of light fractions (gasoline, diesel fuel, etc.), due to the completion of the first phase in modernizing oil refining processes, and a reduction in the export of oil products to foreign markets.
"In 2017, the export of oil products from Russia continued to fall, decreasing by 5% by 2018, while Europe's share of exports was 65%," stated the expert, emphasizing the significance of European destinations for Russian oil exports.
In the medium term, demand for motor fuels is expected to decrease in Europe, which is experiencing an increase in energy efficiency, transitions to alternative types of fuel and growth in the number of electric vehicles, says Mr Pikh. In the Asia-Pacific region, on the other hand, demand for oil products is expected to grow at a faster rate than that of the increase of domestic supply. In relation to this, the stabilisation of export supply may enable both an increase in competition among existing oil products, and stimulation for the development of oil refining and petrochemical industries in Eastern Siberia and the Far East, which opens up the possibility for economically advantageous and competitive diversification of export flows towards the Asia-Pacific region.
The expert also directed attention to the fact that growth in global demand for petrochemical products highlights the importance of expanding the range of refined oil products, to account for the production of raw materials for the petrochemical industry and the increase in production volumes.
Photo: from open sources