BlockBeats report: On July 25, Reuters recently reported that the renewed escalation of military tensions between the United States and Iran is threatening the already fragile recovery of global refining capacity, with Asian refiners hit hardest. Asian refiners, which were previously expected to drive a rebound in global fuel production this quarter, have now come to a standstill due to renewed disruptions in transportation through the Strait of Hormuz.
The Houthi militia in Yemen has threatened to block Saudi crude oil exports through the Red Sea. According to research firm Energy Aspects, this could force more than 3 million barrels per day of Saudi crude, originally routed through the Bab el-Mandeb Strait to Asia, to take a longer detour.
This Tuesday, three Saudi oil tankers originally headed for China and India have turned toward the Suez Canal. As a result, Asian refiners, who had already secured crude oil supplies for August, are now facing delays in deliveries from the Middle East; meanwhile, refineries in the United States and Europe are operating near full capacity, with little room for increased production.
FPCC President Lin Kechang stated that the company originally planned to increase its utilization rate to 480,000 barrels per day (nearly 90% of capacity) in August; although crude oil deliveries for August have been secured, the timing of delivery and arrival of some shipments remains uncertain due to the resurgence of conflict in the Middle East. Another senior executive in China’s refining industry, who requested anonymity, also indicated that shipments loading in July and August are expected to be delayed, making it difficult to ramp up production.
Another source of supply pressure comes from Russia: its refining facilities have been continuously targeted by Ukrainian drones, leading to domestic fuel shortages and forcing Moscow to restrict diesel exports to curb surging domestic prices.
Under the叠加 of multiple factors, global refining margins have been pushed to record highs: refining margins in the U.S. and Europe have reached all-time highs, while those in Asia have hit a two-month peak. According to Neil Crosby, analyst at Sparta Commodities, global refining capacity is insufficient to simultaneously withstand the dual shock of a closure of the Strait of Hormuz and a Russian export ban, meaning prices must rise to dampen end-demand. For diesel and jet fuel, Asian refiners’ margins have surged above $65 per barrel, compared to just over $20 per barrel before the war.