LONDON, Oct 19 (Reuters) - Global oil refining capacity might not meet demand for oil products after 2020 as consumption continues to grow, boosting profit margins, Roger Brown, chief executive of European refiner Varo Energy, said on Thursday.
Refining margins are expected to remain strong in the long term due to strong demand for gasoline and diesel as well as a switch to higher-grade bunker fuels after 2020, Brown said at the Oil & Money conference.
“We see very good long-term refining margins at the moment.”
Refining capacity set to come on line in the coming years, including large plants in Kuwait, China and India, might not be enough to meet growing demand, he said.
“At the pace demand is growing… You’ve got to see supply and demand in refining between 2020 and 2025 remaining balanced and maybe a little short,” Brown said.
Varo Energy, a joint venture between the world’s top oil trader Vitol and private equity giant Carlyle Group, operates two refineries in Europe. (Reporting by Ron Bousso; editing by Jason Neely)