The global energy landscape is undergoing a significant transformation as refining capacity becomes a pivotal factor in fuel market security. Over the next five years, the world is poised to see substantial growth in crude oil processing capabilities, with new projects predominantly located in Asia and Africa. This geographical shift is expected to profoundly alter regional fuel trade flows, as some markets expand their capacity while others face the prospect of refinery closures.
Key Players and Recent Market Interventions
A relatively small group of nations currently dominates global refining capacity. China holds the largest share at 18.1%, closely followed by the United States at 17.5%, and Russia at 6.5%. Together, these three countries account for a substantial 42.1% of the world's total crude oil processing ability.
Recent developments underscore the critical role of these major refiners in global fuel availability. The United States, for instance, considered—and later dropped—a proposal for a 90-day ban on diesel exports. Simultaneously, China temporarily halted fuel exports for October, with PetroChina cancelling gasoline and jet fuel cargoes. Russia also extended its ban on diesel exports, highlighting how domestic policies can quickly impact international markets.
Projected Expansion and Regional Drivers
The global refining industry is preparing for a significant capacity boom. BloombergNEF (BNEF) forecasts a net addition of 4.2 million barrels per day (mb/d) in refining capacity between 2026 and 2030. This represents a staggering 162% increase compared to the preceding five-year period. Should these projects materialize as planned, certain markets could experience an oversupply of refining capacity.
Africa and the Asia Pacific region are slated to drive approximately 95% of this global net capacity growth. Investments in these regions are fueled by rising domestic demand, strategies for import substitution, and the development of export-oriented and petrochemical-integrated refineries.
India and China Lead Near-Term Additions
India and China are projected to account for a combined 71% of the capacity additions in 2026 and 2027, with much of this near-term infrastructure already operational or under construction. India currently ranks fourth globally, holding 4.7% of refining capacity, behind China, the US, and Russia. South Korea and Saudi Arabia also maintain significant refining bases, with 3.4% and 3.2% respectively.
Europe's Contrasting Outlook
In contrast to the expansion in Asia and Africa, Europe holds a much smaller share of global refining capacity. Germany, Italy, and Spain, for example, account for 1.9%, 1.6%, and 1.5% respectively. This smaller base increases the region's reliance on imported refined products, particularly when domestic capacity is insufficient or disruptions occur.
BNEF anticipates further refinery closures in both Europe and the United States, which could further reshape regional product trade flows and increase dependence on external supplies.
Longer-Term Uncertainty and Market Reshaping
While near-term expansion appears robust, the longer-term capacity outlook remains uncertain. A larger proportion of projects scheduled for 2028-2030 are still in earlier development stages, increasing the likelihood of delays or outright cancellations.
The global refining market is thus navigating two opposing trends: a substantial pipeline of new capacity concentrated in emerging economies, alongside potential contractions in mature markets. These dynamic changes are expected to redefine regional fuel trade, refinery utilization rates, and the critical balance between domestic supply and imports in the years to come.