BAKU, Azerbaijan, November 25. Refinery throughput in OECD Europe fell by 370,000 b/d month-on-month to 11.1 mb/d in September, says the latest outlook from the International Energy Agency (IEA), Trend reports.
The decline was largely driven by planned maintenance in the UK and Türkiye, which collectively cut throughputs by 300,000 b/d. Economic run cuts also contributed to the overall reduction, with weak margins playing a significant role.
The IEA assessment highlights that hydroskimming and cracking margins in September dropped to post-Ukraine invasion lows, with hydroskimming margins reaching -$0.48 per barrel and cracking margins falling to $2.09 per barrel. These low-margin conditions persisted into October, contributing to a year-on-year decline of 520,000 b/d in refinery runs for September, following a 420,000 b/d drop in August.
The report also forecasts a recovery in European crude runs toward the end of the year, despite ongoing challenges such as unplanned outages in Türkiye and delayed maintenance in Germany. However, the outlook for 2025 is less optimistic, with a projected 170,000 b/d year-on-year decrease in European crude runs due to a series of planned capacity closures. Notably, the closure of the 140,000 b/d Grangemouth refinery in the UK, along with capacity reductions at two refineries in Germany, will contribute significantly to this decline.
The weak margin environment in Europe may prompt refinery operators to reconsider their capacity rationalization plans. Many of these plans, which appeared unfeasible in the context of the healthy margins of 2022 and 2023, could now be revisited as operators seek to adjust to the current market conditions.