Refining Profit Threatened by European Union Carbon Rebuff: Energy Markets

abarrelfullabarrelfull wrote on 01 Oct 2010 12:56
Tags: europe refinery

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The European Union’s refusal to delay phasing out free carbon-emission allowances may drive up costs for refiners already struggling with a slide in crude-processing profits.

Operating expenses may jump about 13 percent for refiners by 2013, when polluters will be forced to pay for more carbon permits under the EU’s cap-and-trade system, according to the European Petroleum Industry Association, or Europia. The profit from turning crude into fuels such as gasoline and diesel in northwest Europe sank to a seven-year low in the three months through Sept. 23, according to data compiled by BP Plc, Europe’s second-largest oil company.

Having to buy more allowances will “add to the concerns of the industry at a very difficult time,” said Konrad Hanschmidt, a London-based analyst at Bloomberg New Energy Finance, a provider of data and research on carbon markets. Refining industry emissions will rise 2.4 percent in 2011 to 148 million tons, according to New Energy Finance.

For the full story, see: Refining Profit Threatened by European Union Carbon Rebuff: Energy Markets


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