2004: Sign of the Future for Refiners?

Questions

•What drove crude prices up in 2004?

•What caused the light-heavy crude price differences to change in the short run?

•What role did refinery capacity and heavy crude oil production play in 2004 light-heavy crude oil price differentials?

•Are higher refinery margins going to continue in the future and what lies ahead for refinery capacity?


	SWhile the preceding slides focused on what seems to explain the light-heavy crude oil price differential, we have not specifically addressed the role that the refinery capacity element might have played, which is the third question on the list.

	SThis is the question that asks, was there a mismatch between refiners’ ability to process the available supply of heavy crude oil in the market?