Refining limits crimping fuel supply

Effect of the shortage of refineries noted here

Lack of refinery capacity may become a greater fuel supply problem than availability of crude oil over the next 5-10 years, said ICF Consulting Group Inc., Fairfax, Va.

"The crux of the problem is that new global refinery capacity investment is lagging behind demand," said Zeta Rosenberg, an ICF Consulting senior vice-president and fuels expert. "Historically, the oil industry has been able to squeeze out some additional capacity, but the trend increases of the past may not be enough to keep up with forecasted demand."

She said, "Since mid-2004, refinery margins have stayed very strong, and the outlook appears to be the same for the foreseeable future. If supply does not materialize to meet the demand forecast, however, there could be significant negative impacts on global economies and world demand."

Global refinery capacity has decreased to 103% of total oil demand in 2004 from 109% in 1990 and 107% in 2000. "This situation has been overlooked due to the overall oil price explosion and world crude oil spare production capacity issues," said ICF Consulting.

I thought I'd heard something like that or maybe it was this.