Oil refining passes peak

03/14/2010


A few weeks ago I posted a question asking if oil consumption in the U.S. hit its peak in 2007 and will not reach those levels again even after the recession ends. There is more evidence that consumption has indeed peaked because oil companies are now looking at ways to reduce refining capacity. If you can remember back as far as 2006, there was much hand wringing that no new oil refineries had been built in the U.S. since the ‘70s and gas lines were around the corner. Now there is 3 million bpd of idle capacity here and in Europe that will have to be taken offline to get oil companies’ production back into the black.

Let’s face it, most of us thought that oil consumption was on a permanent increase, or at least we were still years away from hitting the peak. Oil consumption rates were like housing prices, they never go down. We were wrong about that too. The Tribune quotes BP CEO Tony Hayward saying, “None of us will sell more gasoline than we did in 2007.”

While I feel bad for people that stand to lose their jobs, (Chevron may cut 2,000.) oil producers closing a few older and less efficient refineries would not necessarily be a bad thing. Of course hurricane-induced outages could be a problem, but in general, concentrating production in a smaller fleet of more sophisticated and cost-effective plants would help rebuild profitability. Some of those plants might also benefit from some long overdue improvements to their plant automation systems. There are plenty of ideas here at Control Engineering.



No comments
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
Each year, a panel of Control Engineering editors and industry expert judges select the System Integrator of the Year Award winners.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
Learn how to increase device reliability in harsh environments and decrease unplanned system downtime.
This eGuide contains a series of articles and videos that considers theoretical and practical; immediate needs and a look into the future.
Learn how to create value with re-use; gain productivity with lean automation and connectivity, and optimize panel design and construction.
Go deep: Automation tackles offshore oil challenges; Ethernet advice; Wireless robotics; Product exclusives; Digital edition exclusives
Lost in the gray scale? How to get effective HMIs; Best practices: Integrate old and new wireless systems; Smart software, networks; Service provider certifications
Fixing PID: Part 2: Tweaking controller strategy; Machine safety networks; Salary survey and career advice; Smart I/O architecture; Product exclusives
The Ask Control Engineering blog covers all aspects of automation, including motors, drives, sensors, motion control, machine control, and embedded systems.
Look at the basics of industrial wireless technologies, wireless concepts, wireless standards, and wireless best practices with Daniel E. Capano of Diversified Technical Services Inc.
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
This is a blog from the trenches – written by engineers who are implementing and upgrading control systems every day across every industry.
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.

Find and connect with the most suitable service provider for your unique application. Start searching the Global System Integrator Database Now!

Case Study Database

Case Study Database

Get more exposure for your case study by uploading it to the Control Engineering case study database, where end-users can identify relevant solutions and explore what the experts are doing to effectively implement a variety of technology and productivity related projects.

These case studies provide examples of how knowledgeable solution providers have used technology, processes and people to create effective and successful implementations in real-world situations. Case studies can be completed by filling out a simple online form where you can outline the project title, abstract, and full story in 1500 words or less; upload photos, videos and a logo.

Click here to visit the Case Study Database and upload your case study.