Analyst Sees IMO2020 Benefit for US Gulf Refiners

Monday January 28, 2019

George Landrith, of US-based thinktank Frontiers of Freedom, has weighed in against any delay to IMO2020.

Writing in the Houston Chronicle, Landrith points out that if anything, US refiners will benefit from the change while 30% of that refining capacity is located in the US Gulf region.

Citing the Houston-based Shell Oil, Landrith said that the company has already introduced updated sulfur recovery techniques, including enhanced fuel cleaning methods and sulfur capture products.

"The company's scot ultra treatment cost-effectively reduces sulfur emissions by up to 60%," he said.

According to Landrith, eight in 10 Gulf Coast refineries are already equipped to convert heavy crude into low-sulfur fuels. The demand for low-sulfur fuel will increase post-IMO2020 which will benefit these refineries.

Citing government statistics, Landrith argued that by 2020, refineries' diesel profit margins could jump 35%.

The Trump administration fears the electoral impact of higher values on refined oil products which may come as a result of the 0.5% global sulfur cap.