30 June 2020
Online conference

Argus Oil Products Market 2020: Global Challenges

Oil refining prospects discussed at Argus online conference

The second Argus Global Oil Products Challenges 2020 online conference was held on 30 June.

More than 150 participants from 25 countries joined the broadcast, which was sponsored by Gazpromneft Trading.

The conference began with a report on demand for oil products in a crisis by Josephine Alström, Argus vice-president for business development in Europe. In particular, Josephine, said that Europe is continuing with its active transition to renewable energy despite the Covid-19 pandemic.

Anton Rubtsov, head of the oil and gas processing department at the Russian Federation’s ministry of energy, spoke about the economics of the Russian oil refining industry in 2020. Rubtsov said that Russian demand for gasoline would recover in July, thanks to the gradual lifting of quarantine measures and renewed business activity.

The topic was continued by Argus senior editor Elvira Chukmarova, who presented an overview of oil product exports from Russia over the past five months. Total output of light oil products increased by 3mn t to 37.4mn t, Chukmarova said. Gasoline production fell by 800,000t to 15.5mn t, while exports of heavy oil products increased by 700,000t to 23.6mn t, she said.

Alexey Kornienkov, head of strategic planning and business development at Gazpromneft Trading, spoke about the outlook for Russian diesel in the European market. He said that the peak of diesel demand in Europe had passed. “Diesel-powered vehicles no longer have the leadership qualities they possessed 20 years ago,” Kornienkov said. “The share of diesel-powered cars in the European fleet is declining. Consumption is not expected to rise back to pre-crisis levels even in 15 years. This means that suppliers to Europe will compete for a shrinking diesel market.”

Andrew Matters, deputy chief economist at the International Air Transport Association (IATA), spoke about the future of the air transport market and jet fuel demand. He said that the coronavirus pandemic has affected passenger traffic more than freight traffic. Jet fuel consumption will fall sharply this year, but transportation will start to gradually recover in 2021, he said.

Grazhvydas Bajoras, BP’s business development and trading manager in Russia and the FSU, spoke during the discussion on the jet fuel market, sharing his views on pricing in Russia.

Event participants also discussed the problems and prospects of the oil products market in the US, Asia-Pacific and central Asia, as well as changes in product trade flows during the crisis and the outlook for the Russian oil industry in 2020.