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2026-08-23T00:00:00.000Z

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Europe's strategies for declining oil derivatives

Europe's strategies for declining oil derivatives

Europe and North America are facing simultaneous pressures on their oil refining capacities due to halted supplies from Russia and rising energy prices resulting from the ongoing war between the United States and Iran. Refining capacity in Europe is expected to decline by up to 20% by 2035, while US refining capacities could decrease by 7% by the same year. This situation continues to drive up fuel prices, especially for diesel, which has increased by approximately 70% since the outbreak of the war. Europe, in particular, depends on imports for about 20% of its diesel needs, primarily relying on Gulf countries and East Asia. The solution lies in ending current conflicts, as refining capacity is expected to diminish further if the war persists, leading to even higher prices for petroleum derivatives. Despite this, Europe is increasingly investing in alternative sources, driven by stringent environmental policies and limited investment in new refineries.

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