Published on Wednesday, November 17 2021
Authors: Eamon Cullinane and Robert Auers

In this third installment of our blog series on how the oil industry is responding to the energy transition, we will focus on the Midstream sector; exploring how their business will be impacted by Energy Transition forces and the various strategies they have started to employ in response.  We will touch upon possible…

Published on Tuesday, October 26 2021
Authors: Robert Auers and John Auers

Part 2 – U.S. Independent Refiners  In the first installment of our blog series on how the oil industry is responding to pressures pushing them to become “greener,” we profiled the various strategies being employed by International Oil Companies (IOC’s).  In today’s blog, we shift our focus to U.S.-based independent refiners.  These companies operate in both defined segments and geographic regions and, as a result their Energy Transition challenges and strategies, are more focused than those…

Published on Tuesday, September 28 2021
Authors: Robert Auers and John Auers

Part 1 – Integrated Oil Company Strategies  Back in 1970, when Led Zeppelin released, “Hey, Hey, What Can I Do,” (their only song not released on an album), the main issue facing the petroleum industry was whether enough oil could be found to meet the world’s ever-growing thirst for the “black gold.”  The theory of Peak Oil…

Published on Tuesday, May 11 2021
Authors: Robert Auers

On May 7, 2021, Colonial Pipeline Company learned it was the victim of an apparent ransomware attack. This led the company to proactively shutdown essentially all of the 2.8 MMBPD Colonial Pipeline system that extends from the U.S. Gulf Coast to New York Harbor for delivery of refined products to…

Published on Tuesday, January 5 2021
Authors: Jonathan Leitch

We entered 2020 with the expectation of higher refining margins, driven by a continuation of strong global economic activity supplemented by an expected IMO boost to product margins and widening of heavy crude discounts. Instead, the COVID-19 pandemic quickly dashed those expectations, with the unprecedented drop in petroleum demand from…

Published on Monday, December 21 2020
Authors: John Auers

As the COVID-19 pandemic continues to persist and impact our lives, lifestyles, and livelihood in so many negative and disruptive ways, it might be tough this Christmas for many of you to get into the celebrating mood.  2020 certainly has been a challenging year both personally and professionally, and uncertainties…

Published on Tuesday, December 15 2020
Authors: John Mayes and John Auers

In the last ten years, refining capacity in Latin America has declined by over 230 MBPD in spite of growing demand, which has increased by about 120 MBPD.  Further exacerbating this growing imbalance is a sharp decline in the refinery utilization rates of the existing refineries in the region.  In…

Published on Tuesday, December 8 2020
Authors: John Mayes and John Auers

For the global refining industry, 2020 has been an exceptionally tumultuous year. As we’ve discussed in our blogs over the last few weeks, the COVID-19 pandemic induced a collapse in the consumption of petroleum products which has resulted in the closure of numerous refineries around the world.  Along with the…

Published on Tuesday, December 1 2020
Authors: John Mayes and John Auers

Last week, we began a discussion of refining industry developments in the sunny (but sometimes very stormy) Caribbean. As we outlined in that blog, refineries located in the Caribbean islands have in past years been a very important source of refined product not only within the region but also for…

Published on Tuesday, November 24 2020
Authors: John Mayes and John Auers

Last week, we discussed the wave of refinery closures that have taken place around the world as a result of the demand destruction caused by the COVID lockdowns.  One region we didn’t mention was the Caribbean, an area that has certainly seen more than  its share of closures, although these…

Published on Tuesday, November 17 2020
Authors: John Mayes and John Auers

Around 500 B.C., the Greek philosopher Heraclitus stated, “The only constant in life is change.”  Much more recently David Bowie sang about the same theme in his classic song, “Changes.”  For the global refining industry, this may have never been more true than in 2020.  The year began with a…

Published on Tuesday, November 10 2020
Authors: Dennis Sutton - PetroQual

The following Turning Point blog is provided by Dennis Sutton.  Following a 40-year career with Marathon Petroleum, Dennis is now Principal of the consulting firm, PetroQual and serves as the Executive Director of the Crude Oil Quality Association (COQA). Obviously, the big story in 2020 in the oil industry is…

Published on Tuesday, November 3 2020
Authors: Elizabeth Hilbourn

On July 2, 2014, the EPA finalized amendments to the RFS program qualifying additional pathways that could be used in producing renewable fuel.  Compressed natural gas (R-CNG) and liquefied natural gas (R-LNG) produced using biogas from landfills, municipal wastewater treatment facility digesters, agricultural digesters, and separated MSW digesters would qualify…

Published on Tuesday, October 27 2020
Authors: Jonathan Leitch

In this blog post, we focus on the challenges facing the European refining industry and prospects for its future. Having recently joined the Turner, Mason & Company team covering the EMEARC markets and based in London, Jonathan offers his insights from 25 years of experience in the crude oil and…

Published on Tuesday, October 20 2020
Authors: Guest - PLG Consulting

Today’s blog was written by PLG Consulting with input from TM&C and previously published on their website.  PLG is a leading consulting firm operating primarily in the supply chain and logistics space.  Like TM&C, they have been heavily involved with helping clients address challenges and take advantage of opportunities in…

Published on Tuesday, October 13 2020
Authors: Eamon Cullinane

There are currently over 20 announced projects/expansions for renewable diesel (RD) over the next four years in the U.S. totaling close to 275 mb/d of possible additional capacity coming online. On a high level, there are mainly two types of renewable diesel projects, stand-alone and co-processing, yet each of these…

Published on Tuesday, October 6 2020
Authors: Robert Auers and John Auers

It seems that the petroleum industry just can’t catch a break these days with demand challenges from COVID-19 related restrictions continuing to linger and politicians blaming climate change and, by extension, hydrocarbons for every natural disaster from forest fires to hurricanes and other extreme weather events.  While demand has already…

Published on Tuesday, September 29 2020
Authors: Robert Auers and John Auers

“Take this Job and Shove It” was written by David Allen Coe in 1977 and made famous that same year by Johnny Paycheck.  Just as the protagonist in the song is making plans to quit his long-time and unsatisfying factory job, British Petroleum (one of the original “Seven Sisters”) more…

Published on Tuesday, September 22 2020
Authors: Eamon Cullinane

On Monday, September 14, the EPA announced it denied 54 “gap-year” petitions filed by small refineries stating that since the refineries have already been able to comply with their past annual RFS obligations and have indeed remained a commercial entity, they do not qualify for the exemptions. This represents a…

Published on Tuesday, September 15 2020
Authors: Elizabeth Hilbourn

Both California and Oregon have had low carbon fuel programs for several years now. The California Air Resource Board (CARB) identified the Low Carbon Fuel Standard (LCFS) as one of nine items under the AB32 Scoping Plan, approved the LCFS regulation in 2009 and began implementation on January 1, 2011.…

Published on Tuesday, September 8 2020
Authors: Robert Auers and John Auers

Last week, we looked primarily at our outlook for petroleum demand and how that will affect the refining industry going forward.  This week, we turn our focus to the other major side of the equation affecting refining margins – supply.  We’ll look first at refining “supply” – that is, current…

Published on Tuesday, September 1 2020
Authors: Robert Auers and John Auers

Nearly three months ago, we published a blog entitled Part 2 “Up Around the Bend” blog series, discussing the outlook for production demand and refining margins as we emerge from the COVID-19 pandemic.  In the first two blogs, we discussed some of the unprecedented effects that the COVID-19 lockdowns had…

Published on Tuesday, August 25 2020
Authors: Eamon Cullinane

In the wake of demand destruction as a result of COVID-19, refiners across the globe have been forced to turn-down rates or in some cases cease production altogether, while at the same time we have seen a handful of project announcements from refiners investing and retrofitting assets for renewable diesel…

Published on Tuesday, August 18 2020
Authors: Eamon Cullinane and Robert Auers

The COVID-19 pandemic (and responsive government actions), together with the wave of violent protests and calls to “defund the police” are leading to potentially major shifts in where and how people in the U.S. live in the coming years.  These shifts can be referred to as either de-urbanization or counter…

Published on Tuesday, August 11 2020
Authors: Eamon Cullinane and Sam Davis

The COVID-19 pandemic has had a profound impact across the industry, with companies having had to respond to unprecedented declines in transportation fuel demand and a historic crash in crude oil prices. To boost liquidity and shore up cash reserves, companies across the board have reduced capital and operating costs…

Published on Tuesday, August 4 2020
Authors: Robert Auers and John Auers

By any measure, 2020 has not gone as planned for anybody and this is particularly true for refiners for whom almost nothing seems to have gone right.  This point is coming across loud and clear during the round of 2nd quarter earnings calls currently being conducted by both independent and…

Published on Tuesday, July 28 2020
Authors: Julia Tossetti and Elizabeth Hilbourn

The topic of renewable fuel feedstock always seems to generate a high level of interest, and rightfully so; the supply of it controls our ability to reduce GHG emissions. The quality and type of it guide the technologies that must process it. This second point is the topic of this…

Published on Tuesday, July 21 2020
Authors: Cinda Lohmann

The Renewable Fuel Standard (RFS) was established by the Energy Policy Act of 2005 and was further expanded in 2007 as part of the Energy Independence and Security Act (EISA).  The RFS program is a Federal policy requiring a specific volume of renewable fuel to be used in place of…

Published on Tuesday, July 14 2020
Authors: Robert Auers and John Auers

It wasn’t long ago that Kelcy Warren (Chairman and CEO of Energy Transfer) said he was so proud of the Dakota Access Pipeline (DAPL) project that he thought of it as if it were his son.  Perhaps this was because he was able to build and start-up the 570 MBPD…

Published on Tuesday, July 7 2020
Authors: Julia Tossetti, Elizabeth Hilbourn and Cinda Lohmann

Last week’s blog touched on the California Low Carbon Fuel Standard (CA-LCFS) program, and the prominent role it occupies in the renewable fuels market. This week, we focus more closely on it. First, a general discussion of how the program works will give us the appropriate context. Next, some of…

Published on Tuesday, June 30 2020
Authors: Julia Tossetti and Sam Davis

Despite the pandemic, interest in renewable fuels continues to grow.  This is largely because government mandates drive its demand, which is expected to continue increasing as carbon-reduction policies reach greater stringency. This is already visible at the federal level, as well as at the state and regional levels, and it…

Published on Tuesday, June 23 2020
Authors: Robert Auers

For the past two weeks, we have been discussing the short-term outlook for petroleum demand. Today,  we are focusing on one important longer-term demand threat – Electric Vehicles or EVs.  Global EV growth slowed to 9% in 2019 after averaging nearly 60% per year for the 2014-2018 time period. Growth…

Published on Tuesday, June 16 2020
Authors: By Robert Auers and John Auers

Last week in this space, we provided our latest view on how quickly overall refined product demand would recover from the pandemic lockdowns (“Up Around the Bend” - What lies ahead for product demand and refiners’ prospects as COVID lockdowns ease – Part 2?”).  To support our forecasts, we presented…

Published on Tuesday, June 9 2020
Authors: Robert Auers and John Auers

Six weeks ago, we published a blog entitled “Up Around the Bend” - What lies ahead for product demand and refiners’ prospects as COVID lockdowns ease?”.  In that blog, we discussed some of the unprecendented effects that the COVID-19 lockdowns had on petroleum demand, including sending both gasoline and jet…

Published on Tuesday, June 2 2020
Authors: Sam Davis and John Auers

We continue our blog series from the past few weeks covering first quarter earnings reports of the various segments of the petroleum industry, with today’s focus on the Canadian integrated companies.  We’ll start by giving them kudos for the way they have stepped up in a big way in support…

Published on Tuesday, June 2 2020
Authors:

Memorial Day has traditionally come to signify the end of school and the beginning of summer.  It was also a time that signaled the start of the vacation travel season, with most of us eagerly anticipating trips to the beach, the mountains, amusement parks or even exotic foreign destinations.  While…

Published on Tuesday, May 19 2020
Authors: Sam Davis and John Auers

In last week’s blog, we mentioned steps the integrated majors were taking in response to the COVID-19 pandemic. The U.S. independent refiners were no different. They all took steps to support community efforts, from manufacturing and distribution of hand sanitizers to hospitals and emergency responders, to donations towards pandemic relief…

Published on Tuesday, May 12 2020
Authors: Sam Davis and John Auers

The COVID-19 pandemic has had a profound impact not only on our everyday lives but also on the companies we work for. Across the industry, companies have had to make dramatic changes in the way they operate. Employees who could were encouraged to work from home while additional cleaning, personal…

Published on Tuesday, May 5 2020
Authors: Eamon Cullinane and John Auers

In what was the most highly anticipated event to occur in the bunker industry, in the last decade, IMO 2020 is now but a memory of the past as COVID-19 has taken center stage. The pandemic has caused an unprecedented drop in petroleum demand and in doing so; the price…

Published on Tuesday, April 28 2020
Authors: By Robert Auers and John Auers

As refiners looked toward 2020, many had dreams of growing margins driven by a continuation of strong global economic activity supplemented by an expected IMO boost to product margins and widening of heavy crude discounts.  Unfortunately, the COVID-19 pandemic has turned those dreams into nightmares, with the unprecedented drop in…

Published on Tuesday, April 21 2020
Authors: John Auers and Robert Auers

Over the last two weeks, we have discussed how the unprecedented drop off in petroleum demand from COVID-19 lockdown measures is impacting crude slates at U.S. refineries.  In the previous blogs, we looked at both the inland regions (PADDs 2 and 4) and the largest refining region, PADD 3.  Refiners…

Published on Tuesday, April 14 2020
Authors: John Auers and Robert Auers

Last week, we began our series analyzing how the collapse in petroleum demand and subsequent required reductions in refining throughput will impact crude slates at U.S. refineries.  In that blog, we discussed the fundamental factors which influence the types of crudes refiners purchase and the regional differences influencing those factors. …

Published on Tuesday, April 7 2020
Authors: John Auers and Robert Auers

Last week, we discussed the challenges refiners are experiencing in the face of the sharpest and quickest drop in demand the world has ever experienced.  Our focus in that blog was on how much refinery utilization would have to decline, the difficulties associated with “turndown” limits on units and the…

Published on Tuesday, March 31 2020
Authors: Robert Auers and John Auers

The drastic lockdown measures being employed to stop the spread of the COVID-19 virus is resulting in a drop in petroleum product demand that is unprecedented in both magnitude and speed.  With no place to sell their products, refiners are scrambling to cut throughputs.  This is resulting in the “End…

Published on Tuesday, March 24 2020
Authors: John Auers and Robert Auers

The COVID-19 pandemic and Saudi/Russia oil war has so dramatically changed the world and in such a short time, that Jethro Tull’s late 60’s classic, “A New Day Yesterday” seems entirely appropriate to describe the radically different outlook for the petroleum industry that prevails today than just a couple weeks…

Published on Tuesday, March 17 2020
Authors: By Robert Auers and John Auers

The dramatic events of the last week and a half have thrown the entire world and each of our individual lives into very unpredictable and scary territory.  This is certainly true for the petroleum industry as well, which has seen oil prices, product demand (both actual and expected), and company…

Published on Tuesday, March 10 2020
Authors: Robert Auers

The past several years had already been a difficult period for the midstream world (in terms of equity performance), but the past few weeks have been particularly harsh. Yesterday’s oil price crash as a result of the Russian/Saudi tit for tat (piling on to the growing COVID-19 fears) has put…

Published on Tuesday, March 3 2020
Authors: Sam Davis and John Auers

Continuing pipeline constraints out of Western Canada and the ensuing production curtailment program that began in early 2019 has resulted in significant price volatility between the WTI and WCS benchmark differentials over the last couple of years.    Canadian integrated refiners have experienced both the best and the worst of these…

Published on Tuesday, February 25 2020
Authors: John Auers and Robert Auers

The early days of the new decade of the 2020s has shown to be a challenging one for refiners, with both anticipated and unanticipated events leading to an uncertain and challenging environment for industry participants.  In thinking about this situation and challenges faced by refiners, the ZZ Top classic, “Got…

Published on Tuesday, February 11 2020
Authors: Sam Davis and John Auers

As fourth quarter and full year 2019 earnings season draws to a close, we pause to reflect on a difficult year for the industry but also take note of a future holding both challenges and opportunities.  Many of these are coming from the changing industry environment wrought by the worries…

Published on Tuesday, February 4 2020
Authors: Sam Davis and John Auers

After a little more than a year into his presidency, Andres Manuel Lopez Obrador, known most commonly as “AMLO,” is already having a major impact on Mexico’s energy landscape.  His administration has made a number of bold statements, promising to revive the country’s oil industry, fix its many problems and…

Published on Tuesday, January 28 2020
Authors: Eamon Cullinane and John Auers

Leading up to IMO 2020 just about everyone predicted that the required increased flow of distillates into the bunker market would significantly boost distillate cracks.  Well IMO 2020 is finally here and the shift to low sulfur bunker fuel is in full swing, but not only have we not seen…

Published on Tuesday, January 21 2020
Authors: Eamon Cullinane

IMO 2020 is finally here and the shift to low sulfur bunker fuel is in full swing. In one of our past blogs, we discussed the options that exist to refiners to remain competitive with the implementation of the regulation. One of those options was changing your crude slate to…

Published on Tuesday, January 14 2020
Authors: Sam Davis and John Auers

2020 is shaping up to be another year of volatility for the downstream industry as crude prices, product demand, export markets, and refinery specific developments all have the potential to make headlines against a back drop of growing geopolitical tensions and the upcoming U.S. Presidential election. With IMO 2020 now…

Published on Monday, January 6 2020
Authors: George Hoekstra, Hoekstra Trading LLC – Guest Writer

Mr. Hoekstra is a 45-year veteran of the petroleum industry, with an extensive background in hydroprocessing technology. Turner, Mason & Company (TM&C) once again welcomes his independent thoughts (not necessarily the same as TM&C’s) on the progress refiners have made and the challenges they continue to face in meeting Tier…

Published on Monday, December 30 2019
Authors: Robert Auers and John Auers

As we say goodbye to 2019 for the last time tonight, the petroleum industry heads into the new decade with a lot of uncertainties and challenges.  With the two parties offering energy policies that are almost 180 degrees apart from each other, the 2020 U.S. Presidential election will be one…

Published on Monday, December 23 2019
Authors: John R. Auers

With uncertainties and challenges looming in all corners of our industry (IMO, Tier 3, declining rig counts, geopolitical and regulatory uncertainty, etc.), it might be tough this Christmas for some of you to recognize the “Tidings of Comfort and Joy” that come with the Season.  2019 was certainly a challenging…

Published on Tuesday, December 10 2019
Authors: By Robert Auers and John Auers

On the heels of last week’s OPEC+ meeting and the flood of recent articles and reports calling attention to an expectation of an oversupply of crude oil next year, we decided it was worth outlining our somewhat contrary views regarding the global liquids supply and demand balance for 2020.  The…

Published on Tuesday, November 26 2019
Authors: John Auers

As I was enjoying another college football Saturday this weekend, I got to thinking about the similarities between the BCS landscape and U.S. regional refining competitiveness.  Just as the SEC is again the big dog on the college gridiron, with Gulf Coast power LSU leading the way (so far) this…

Published on Tuesday, October 29 2019
Authors: Ed Koshka and John Auers

Perhaps following the advice of their iconic rock band, Bachman Turner Overdrive (BTO), Canadian voters chose to “Let it Ride” with incumbent Prime Minister (PM) Justin Trudeau in last week’s national elections.  Despite all the scandal, controversy and personal low popularity, Trudeau’s Liberal Party garnered the plurality of seats (157)…

Published on Tuesday, September 17 2019
Authors: John Mayes

Turner, Mason & Company will issue its latest edition of the Worldwide Refinery Construction Outlook (WRCO) this week.  This bi-annual publication details all announced global refinery constructions projects in the next five to six years.  Whether it’s simply an expansion of a single processing unit or the addition of an…

Published on Tuesday, September 3 2019
Authors: Eamon Cullinane and John Auers

We certainly hope everyone had an enjoyable and relaxing Labor Day weekend.  As we return to work after this traditional “end of summer” holiday, which was created in the late 19th century to honor U.S. workers, we thought it would be appropriate to write a blog detailing the advantages those…

Published on Tuesday, June 4 2019
Authors: Robert Auers

North American midstream investments are trying to keep pace with rapidly growing production with most midstream operators benefitting financially from this production growth (though you might not know it looking at their equity performance). In the last installment of our Q1 earnings call reviews; we focus on the larger Midstream…