Implications of the US Shale Hydrocarbons Surge for the Refining and Petrochemicals Industries

The US oil and gas sector is amidst a major transformation driven by a surge of natural gas and tight oil extracted from shale formations. This shale revolution has wrought significant changes across the US energy sector: reducing foreign oil imports; rendering superfluous recently built LNG terminals; and triggering displacement of coal-fired power generation capacity in favor of gas-fired power plants.

Despite the increasing media and public attention on the US shale sector, coverage of its impact on the downstream oil value chain has hitherto been superficial, and is often limited to obvious direct effects such as changes to the crude diet of US refineries. Drawing from our experience and contacts in the downstream oil industry and our recent assessments of the shale sector, we will provide a comprehensive view of the implications of the shale boom, and outline strategies for downstream oil stakeholders to proactively respond to current and emerging market trends.