IRAN REFINERY OUTLOOK - petroview.ir

IRAN

REFINERY

OUTLOOK February 2021

International View

Iran Refinery Outlook, Februay 2021

Naphtha

• In Asia, combination of crackers returning from maintenance and high LPG prices amid the colder-than-usual winter

will keep demand high through 1Q21, but regional production will largely move sideways through to April amid a

limited increase in refinery runs.

Gasoline

• It is expected the regional gasoline demand to reach close to 2019 levels of 1.9 mmb/d by August 2021. Overall,

2021 demand will only be 90 kb/d below 2019 levels.

Middle Distillate

• The March EFS spread was pegged at plus $1.25/mt. The recent declines in voyage rates are helping the arbitrage

to remain open, making viable to send cargoes from west to the east.

• Based on data from ICAO, in the most optimistic scenario, it is expected the passenger numbers to recover to 71%

of 2019 levels by June of 2021. A more pessimistic scenario would see a recovery to just 49%.

Fuel Oil

• HSFO supply is likely to remain tight due to lower refinery runs during the Spring turnaround season and also

because of lower availability of HS barrels as Saudi Aramco reduces supply of its medium/heavy HS crudes.

3

International View

• Runs are expected to remain flat during the Spring turnaround season as the ramp-up of new and idled capacity

should offset the loss of any capacity going offline for maintenance.

• Margins are also likely to remain flat over the next few months as the ongoing weakness in jet demand will offset the

recovery in other product cracks.

• There is currently much talk about demand recovering and the total hydrocarbon balance tightening, leading to crude

and product stock draws and higher crude oil prices. With prices currently in the high $50s/bbl, it seems a lot of non-

OPEC (especially the USA and Canada) production will be viable and OPEC (particularly Saudi Arabia) will have to

think hard about how they manage their production levels.

• Given the length in middle distillate this year, refiners will still have to be creative and maximise the amount of middle

distillate effectively the lighter part of jet/kero going into naphtha and gasoline.

• As global oil demand recovers further through 2021, the Call on OPEC+ is seen moving well beyond OPEC+’s

current planned production target levels. During this time, we see a lot of upside potential to oil prices, especially if

OPEC+ fails to respond quickly enough.

Iran Refinery Outlook, Februay 2021 4

Historical Prices

Crude Oil


34.00

36.00

38.00

40.00

42.00

44.00

46.00

48.00

50.00

52.00

54.00

56.00

58.00

10/02/20 10/09/20 10/16/20 10/23/20 10/30/20 11/06/20 11/13/20 11/20/20 11/27/20 12/04/20 12/11/20 12/18/20 12/25/20 01/01/21 01/08/21 01/15/21 01/22/21 01/29/21

$/b

Crude Oil Prices

WTI Brent Dubai

6

Source: Platts

Gasoline


36.00

38.00

40.00

42.00

44.00

46.00

48.00

50.00

52.00

54.00

56.00

58.00

60.00

62.00

64.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Gasoline Historical Prices

95RON FOB Singapore 95RON FOB Persian Gulf


-4.00

-2.00

0.00

2.00

4.00

6.00

8.00

10.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Gasoline Historical Cracks



7

Source: Platts Source: Platts

Kerosene


34.00

36.00

38.00

40.00

42.00

44.00

46.00

48.00

50.00

52.00

54.00

56.00

58.00

60.00

62.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Kerosene Historical Prices

FOB Singapore FOB Persian Gulf

-6.00

-4.00

-2.00

0.00

2.00

4.00

6.00

8.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Kerosene Historical Cracks

FOB Singapore FOB Persian Gulf

8

Source: PlattsSource: Platts

Gasoil


36.00

38.00

40.00

42.00

44.00

46.00

48.00

50.00

52.00

54.00

56.00

58.00

60.00

62.00

64.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Gasoil Historical Prices

10ppm FOB Singapore 10ppm FOB Persian Gulf


-4.00

-2.00

0.00

2.00

4.00

6.00

8.00

10.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Gasoil Historical Cracks



9

Source: PlattsSource: Platts

Fuel Oil

Source: Platts Source: Platts


34.00

39.00

44.00

49.00

54.00

59.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Fuel Oil Historical Prices

180cst FOB Singapore 180cst FOB Persian Gulf


-8.00

-6.00

-4.00

-2.00

0.00

2.00

4.00

6.00

10/02/20

10/09/20

10/16/20

10/23/20

10/30/20

11/06/20

11/13/20

11/20/20

11/27/20

12/04/20

12/11/20

12/18/20

12/25/20

01/01/21

01/08/21

01/15/21

01/22/21

01/29/21

$/b

Fuel Oil Historical Cracks



10

Price Forecast

*ESPM: East of Suez Products Model. The model used by PetroView to forecast the oil products prices for the East of Suez markets.


50.00

52.00

54.00

56.00

58.00

60.00

62.00

64.00

66.00

68.00

Jan-21 Feb-21 Mar-21 Apr-21 2Q2021 3Q2021 4Q2021 1Q2022 2Q2022 3Q2022 4Q2022

$/b

Crude Prices Outlook

Brent WTI Dubai

Crude Oil

12

Source: ESPM based on Argus data*

Source: ESPM based on Argus data* Source: ESPM based on Argus data*


Gasoline

13

54.00

56.00

58.00

60.00

62.00

64.00

66.00

68.00

70.00

72.00

74.00

76.00

$/b

Gasoline Prices Outlook FOB PG

87RON 95RON

0.00

2.00

4.00

6.00

8.00

10.00

12.00

$/b

Gasoline Cracks Outlook FOB PG

87RON 95RON


Kerosene

14

Source: ESPM based on Argus data*Source: ESPM based on Argus data*

54.00

56.00

58.00

60.00

62.00

64.00

66.00

68.00

70.00

72.00

74.00

76.00

78.00

$/b

Kerosene Prices Outlook FOB PG

Jet/Kero

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

$/b

Kerosene Cracks Outlook FOB PG

Jet/Kero


Gasoil

15


52.00

54.00

56.00

58.00

60.00

62.00

64.00

66.00

68.00

70.00

72.00

74.00

76.00

78.00

$/b

Gasoil Prices Outlook FOB PG

10ppm 500ppm 2500ppm 5000ppm 10000ppm

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

13.00

$/b

Gasoil Cracks Outlook FOB PG

10ppm 500ppm 2500ppm 5000ppm 10000ppm


Fuel Oil

16


48.00

50.00

52.00

54.00

56.00

58.00

60.00

62.00

$/b

Fuel Oil Prices Outlook FOB PG

180cst 380cst

-8.00

-7.00

-6.00

-5.00

-4.00

-3.00

-2.00

-1.00

0.00

$/b

Fuel Oil Cracks Outlook FOB PG

180cst 380cst

Iranian Refineries

Refineries can produce large-range products. However, the five key products including LPG, gasoline, kerosene, gasoil,

and fuel oil conclude approximately 90 percent of Iran’s refineries. Accordingly, the cracks are calculated base on these

products.

Iran’s Refinery Margin Index (IRMI) is a benchmark provided by PetroView to assess the Iranian publicly-listed refineries'

profitability and represent an overview of the refining industry.

Output


0

200

400

600

800

1000

1200

1400

1600

1800

2000

Shahrivar Mehr Aban Azar Dey

m^3

Th

ou

sa

nd

s

Isfahan

LPG Gasoline Kerosene Gasoil Fuel Oil Others

0

200

400

600

800

1000

1200


m^3

Th

ou

sa

nd

s

Tehran


18

Source: Codal.ir Source: Codal.ir


0

100

200

300

400

500

600


m^3

Th

ou

sa

nd

s

Tabriz


0

200

400

600

800

1000

1200

1400

1600


m^3

Th

ou

sa

nd

s

Bandar Abbas


Output

19



0

50

100

150

200

250


m^3

Th

ou

sa

nd

s

Shiraz


0

50

100

150

200

250

300

350


m^3

Th

ou

sa

nd

s

Lavan


Output

20


Feedstock


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Isfahan Tehran Tabriz Bandar Abbas Lavan Shiraz

%

Feedstock Share

Crude Oil Condensate

21

Source: Codal.ir

Output Share


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


%

Output by Products

LPG Kerosene Gasoline Gasoil Fuel Oil Others

22

Source: Codal.ir

Iran’s Refinery Margin Index


0.00

0.50

1.00

1.50

2.00

2.50

3.00

May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Jan-21

$/b

IRMI

23

Source: PetroView

Margin Outlook

Source: PetroView


-4.00

-2.00

0.00

2.00

4.00

6.00

8.00

Jan-21 Feb-21 Mar-21 Apr-21 2Q2021 3Q2021 4Q2021 1Q2022 2Q2022 3Q2022 4Q2022

$/b

Margin Outlook


24

Phone : +98 (21 ) 6648 9724

E m a i l : i n f o @ p e t r o v i e w. i r

PetroView is an Iranian oil & gas research and consultancy platform, providing market

intelligence and business insight through connecting data, markets and clients to create a trusted

comprehensive view of the oil industry, enabling the decision-makers to develop their strategies,

mitigate risks, improve productivity and pursue new opportunities. From a primary focus on Iran’s

upstream industry, PetroView publishes an extensive range of analytical reports covering

exploration & production, oilfield services, and crude oil & petroleum products trading.

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IRAN REFINERY OUTLOOK - petroview.ir