Victor Scalco - General Atomics
At the beginning of 2020, the refining industry anticipated a year of profitability, with projects anticipated to support refinery expansions, upgrades and new grass root efforts. The global COVID-19 pandemic introduced an unseen assailant on the industry worldwide, with its effect on oil and gas production still reverberating throughout the refining community today.
The Pandemic’s Ripple Effect
Even though global oil prices closed at previous year averages of $51 a barrel, 2020 remained a year of volatility spurred on by countries adopting climate change policies to limit carbon emissions as well as the growing global pandemic crisis. In April, United States crude plunged deep into negative territory and Brent dropped below $20 per barrel. During the following months, the refining industry desperately tried to reinvent itself as the pandemic destroyed fuel demand, exposing an unforeseen future reality of a world operating with a much lower hydrocarbon dependency.
That reality portends a high probability hydrocarbon production in the coming years could remain weak as recovery efforts from the pandemic begin to take hold. (4)
It is therefore essential to survive this volatility, today’s modern refinery must increase opportunities to remain profitable and in the black. Reducing lost profits from the refinery process and investing in more efficient technologies that improve profitability is of utmost urgency as the industry moves into post-virus stability.