Why are there no new Oil Refineries built lately when price of Oil today is higher than it was 50 years ago?
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This has to be answered depending on which country you’re talking about. Refined oil products ie the output of oil refineries has a particular demand curve to it. Refineries are built according to demand and not the price of oil.
In many of the EU countries and Japan, demand for refined oil has gone down over the last few decades. In the US, refined oil demand has remained more or less flat since for the better part of 3 decades. This accounts for a great deal of the total demand.
Most of the growth in refined oil demand over the last few decades is in China and India. Both countries have their own refining capacity and expand it over time.
Oil refining tends to be a “local” business (except for countries like Singapore who sell to nearby regions) so if the demand isn’t there locally, more refining capacity isn’t built. Given the flat or falling demand, it makes more sense to refurbish and upgrade existing refineries rather than invest in new ones. Refineries are hugely expensive, take lots of time to get permits, and require many years of operation to breakeven.
Many developed countries have specific policies to reduce the use of gasoline/petrol for private vehicles in the next decade or two. This is not a good environment to invest in new refineries.
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