The International Energy Agency said massive build-ups in stocks in recent months are set to keep profit margins for refining crude into petroleum products like road and aviation fuels subdued.
The new coronavirus outbreak meant over 4 billion people were under some form of lockdowns, destroying demand for oil products, with road and aviation fuels being the hardest hit.
Due to coronavirus lockdowns, mobility was reduced globally by close to 70 percent in April and 40 percent in May. As a result, refining margins turned negative in key hubs like Asia Pacific and northwest Europe. This signals the refiners gained loss.
Global refining intake was down 6.6-68.8 million bpd month on month in April. The agency said refining intake fell by a further 1 million bpd in May. The Organisation for Economic Co-operation and Development (OECD) oil product inventory stocks gained around 2 million bpd-1.56 billion barrels in April. Middle distillates led the increase in the month.
