A bleak outlook for Europe’s refiners amid closures

Increasing exports from US and Middle East refineries seem set to bring more closures in Europe

Europe's refineries, already heavily underutilised, face another wave of closures in the wake of rising exports from the world’s lower-cost refining centres. With shrinking demand, high costs and narrowing margins, Europe’s elderly facilities have not attracted the investment needed to compete – yet new entrants continue to show interest in European refining. Most recently, Varo Energy – a 50:50 venture between oil trader Vitol and private-equity house Carlyle – bought OMV’s interest in the Bayernoil refinery, Germany, and the partners say they plan to grow Varo into a substantial refining operator. Oil traders, private-equity houses and Russian companies have been involved in acquisitions o