World Refining Capacity

Broadly speaking, refining developed in consuming areas, because it was cheaper to move crude oil than to move product.  Furthermore, the proximity to consuming markets made it easier to respond to weather-induced spikes in demand or to gauge seasonal shifts.  Thus, while the Mideast is the largest producing region, the bulk of refining takes place in the United States, Europe or Asia. 

There have historically been a few exceptions, concentrations of refining capacity that were not proximate to consuming markets.  A refining center in the Caribbean, for instance, supplied heavy fuel oil to the U.S. East Coast where it was used for power, heat, and electric generation.  As the demand for this heavy fuel oil, or residual fuel oil, waned, so did those dedicated refineries.  While the Caribbean refineries, as well as refineries in the Middle East and in Singapore, were built for product export, they are the exception.  As such, most refineries meet their "local" demand first, with exports providing a temporary flow for balancing supply and demand.  

The largest concentration of refining capacity is in North America (in fact, the United States), accounting for about one-quarter of the crude oil distillation capacity worldwide,  Asia and Europe follow as refining centers. North America (again, the United States) has by far the largest concentration of downstream capacity -- the processing units necessary to maximize output of gasoline.  The gasoline emphasis of course mirrors the demand barrel and hence refinery output of the different regions, since no other global region uses as much of its oil in the form of gasoline as North America does.

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