War exposes Western oil refining costs
The oil refining industry in the West is experiencing a severe crisis due to rising fuel prices and the impacts of geopolitical conflicts, especially the Iran war and the ongoing Russia-Ukraine tensions, which have disrupted the daily production and refining of millions of barrels of oil. Although refining companies have responded to market demands by postponing maintenance and increasing output, the shortage of operational refineries and the diminished capacity to meet the global demand for diesel and gasoline are deepening the fuel shortage crisis and causing unprecedented price hikes, with diesel in Europe exceeding $200 per barrel and gasoline in the United States surpassing $6.50 per gallon. Governments are moving toward initiatives to boost production, such as relaxing fuel specifications or temporarily banning exports, despite the risk of causing greater market volatility. Meanwhile, Asian refineries, being less affected, may play a role in alleviating the crisis.
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