SHow can we test the world refining capacity limit theory?  There are several ways.
	SDid we see dramatic imbalances and price surges?
		–In the past decade, refinery utilization in the U.S. and Europe has been high.  Occasionally, surges in demand have exceeded supply for short periods (1-2 months).  During these times, inventories dropped much more rapidly than normal.  During such times, product prices spiked relative to crude oil prices.  That did not occur in 2004.
		–Light product inventories (gasoline and distillate) in the U.S., Europe, and OECD Asia started 2004 at the lower end of their typical ranges, but no significant draw down occurred relative to normal seasonal changes.  That is, production of light products from refineries kept up with rising demand.
	SWere there any signs that incremental heavy crude oil production was not used?
		–As OPEC increased production of heavy sour crude oil, there  was no indication that this incremental production was not sold or that refiners were unable to process it.  Refinery input rose, and product demand was met.
	SFinally, was world refining capacity running at maximum utilization:  The next several slides will look at refinery capacity utilization in 2004 to explore any indications that world utilization was at its maximum levels.