News Wires — Royal Dutch Shell saw a year-on-year fall in refining and petrochemical margins across the key refining regions of Europe, Singapore and the United States, the oil major said in its 2018 annual report.
Rotterdam average gross refining margins were down over 40 percent at $2.5/bbl. Singapore margins fell over 60 percent while U.S. Gulf Coast coking margins were down nearly 30 percent.
Shell said slowing oil product demand growth in line with global economic growth, higher crude prices and refinery capacity additions in the Middle East and Asia contributed to the fall.
“Looking forward, we believe refinery margins may be impacted by the introduction of the new International Maritime Organization shipping fuel specification in 2020,” the report said.
Shell said Asian naphtha cracker margins fell sharply in Q4 2018 on concerns over the potential impact of U.S. tariffs. U.S. ethane cracker margins were pressured by new capacity additions. But in Europe, demand was healthy and naphtha cracker margins in the region decreased the least in 2018.