20% of Global Oil-Refining Capacity at Risk of Closure, Says Wood Mackenzie

Current Context: According to a recent analysis by energy consultancy Wood Mackenzie, more than a fifth of global oil refining capacity is indeed at risk of closure.

• This is due to a variety of factors including weakening gasoline margins, increasing pressure to reduce carbon emissions, and rising operating costs.
• The analysis scrutinized 465 refining sites and found that about 21% of 2023 global refining capacity is at some risk of closure.
• Europe and China house the greatest number of high-risk sites, putting about 3.9 million barrels per day (bpd) of refining capacity in jeopardy.
• 11 European sites account for 45% of all high-risk plants.
• About 30 European refineries have already shut down since 2009, with nearly 90 still in operation.
• This spate of closures has been brought on by competition from newer and more complex plants in the Middle East and Asia, as well as the impact of the COVID-19 pandemic.
• Gasoline margins are expected to weaken by the end of this decade as demand declines and sanctions on Russia ease, while expected carbon taxes should also start to bite.

Question:

Q.1 According to a recent analysis by Wood Mackenzie, what percentage of global oil refining capacity is at risk of closure?
a. 10%
b. 50%
c. 30%
d. 21%