With tight natural gas supplies globally, expect to see energy and carbon optimization become more significant in plant optimization After taking a month’s holiday from the blog, we are back this month with what has probably been the biggest change in the market – natural gas. It would appear that the age of cheap energy […]
Energy Transition accelerated in EU and USA by Covid-19 resulting in peak Mogas demand, other regions to keep oil demand growing for some time In this month’s economic engineering update, we zoom out for a look at the global supply and demand environment for oil, transportation fuels, and petrochemical feedstocks. The Covid-19 pandemic caused a […]
US Refiners See High Crack Spreads, but Renewable Fuel Credits Eat into Actual Profits Recently we have seen some buzz about refining crack spreads being at favorable levels. While this appears to be true on the surface, a key component of understanding actual domestic fuels production profitability is the current value of the Renewable Volume […]
Fuels demand projected to increase, although less than 2019 The US Government’s Energy Information Administration (EIA) released their take on how gasoline and diesel demand might recover in their Short Term Energy Outlook (STEO) this week. The forecast shows that gasoline demand will increase in 2021 to levels above the low set in 2020; however, […]
Vaxications, a Texas Deep Freeze, and Summer Driving Season – finally a booster shot for refining margins? Last time I wrote (January of this year) we were in the midst of the second wave of Covid-19 in many places around the world and things were not looking so great for refining margins once again. In […]
With higher refined product prices, conversion margins improve Despite a new and more severe wave of Covid-19 and its restrictions, product prices and demand have been surprisingly resilient. We have seen diesel and gasoline cracks hold up nicely over the last few weeks leading to some healthier conversion unit margins, especially at the Fluid Catalytic […]
Distillate production back in favor, but will it reverse again before the winter is over? As you may recall, I wrote about distillate pricing relative to gasoline (a large determinant of refining operating strategy) a couple months back. At that time, we had finally seen gasoline start to lift away from diesel as relentless inventory […]
Most complex facilities such as refineries and chemical plants utilize some type of Linear Programming (LP) software to optimize and help plan for feedstocks, unit conditions, and even future investments. These models generally optimize a system of linear equations against a set of constraints given an objective function (usually profitability). Specialized LP engineers are needed […]
US Distillates Market begins to feel the pinch Since the pandemic started and we saw Jet demand drop to levels unseen in many years, I have postulated that distillates will go long in a significant and difficult to deal with way in the US. This is due to the need to blend or fractionate a […]
