Half of the Australian refining capacity to shut by 2022: ExxonMobil to shut Altona refinery

ExxonMobil announced the conversion of its Altona refinery to an import terminal. This is the next refining asset in Australia that will be closed after BP's Kwinana refinery. It means that half of the Australian refining capacity will be shut by 2022. It shows the challenging environment in the refining industry due to the Covid-19 pandemic and a global overcapacity in refining, pressuring margins. Older, smaller and less complex refiners with limited petrochemical integration in isolated location expect to face a high risk of closure, despite the government support. In this insight, we discuss the structural issues in Australia's refining industry and share our views on the implications of the closures on Australia's oil product balances.