Analyst Says This Is Why Global Oil Prices Are Rising Amid OPEC+ Agreement: It Has All to Do With Refiner

GasBuddy analyst Patrick De Haan said that global oil prices were rising as limited refinery capacity across the globe could lead to supply issues.

Focus Shifts To Oil Refineries

In a series of posts on the social media platform X on Monday, De Haan illustrated how refinery capacity could decide oil prices. “Expect refineries- the middleman to the oil/refined product price relationship- to be extensively discussed with suddenly too little global refining capacity,” he said in a post.

He had quoted a post by user Ellen R. Wald, who said the importance of refining capacity, without which oil was “just some sludge” underground. Her comments came as Saudi Arabia slashed prices of its flagship Arab Light crude for Asia by $11 per barrel.

In a separate post, De Haan said that wholesale gas and diesel prices rose up to 12 cents/gallon on Monday, outlining that oil prices “may suggest plentiful supplies,” but the “finite amount of global refinery capacity” was “heavily weighing” on costs.