Idemitsu to Cut Refinery Output by 14% on Falling Demand
08 September 2008
Japan-based Idemitsu Kosan Co. will reduce its crude oil refining by 14% to 7.5 million kiloliters (47 million barrels, 516,000 barrels per day) for the fourth quarter of 2008 compared to the same period in 2007, due to decreasing demand.
Idemitsu, which started reducing refinery output in August, plans a 5% cut to 5.6 million kiloliters (35 million barrels, 577,000 barrels per day) in the two months ending 30 September.
To offset falling demand in Japan, the company will begin exporting diesel to Mexico at an annual rate of 200,000 kiloliters (1.3 million barrels, 3,600 barrels per day) later this year. The firm will also consider exporting gasoline.
Idemitsu operates four refineries in Japan.
This is very good news. Lets hope that this trend will continue as more efficient vehicles hit the market.
We may even see oil below $100/barrel if consumption can be reduced fast enough.
Posted by: HarveyD | 08 September 2008 at 08:30 AM
I think it is the greying of Japan as well as efficiency improvements.
As the Japanese get older, they give up the Skylines and move to Kei cars.
Hence the reduction in fuel use.
Posted by: mahonj | 08 September 2008 at 09:38 AM
The reduction in fuel use is mostly because of high prices. The prices were high because all governments allowed speculation in the oil market whilst not allowing or ensuring an actual free market in oil or energy. A drop of prices at Japanese pumps would increase the demand to the point that the refineries could operate at full production. Airlines are still paying high prices for fuel whilst this company is reducing production. ..HG..
Posted by: Henry Gibson | 08 September 2008 at 03:53 PM