Eni SpA (E), Italy's biggest energy company by market value, said Tuesday that a refining boom in the Middle East is putting pressure on European refiners because the MidEast producers, who have lower costs, are now entering the market in Europe especially the Mediterranean.
Eni SpA (E),
Italy
's
biggest energy company by market value, said Tuesday that a refining boom in
the
Middle East
is putting pressure on European refiners because
the
MidEast
producers, who have lower costs, are now entering
the market in
Europe
especially the
Mediterranean
.
"
Italy
was a
hub for Middle Eastern crude, but not anymore as
Middle
East
[oil companies] are now vertically integrated," Domenico Elefante,
Eni's executive vice president for refining, told Dow Jones Newswires on the
sidelines of the Global Refining Summit in
Barcelona
.
Elefante also said it isn't a problem for Eni to replace Iranian barrels which
are subject to western sanctions as the import volumes have been low. He didn't
provide further details on the volumes.
Eni is mainly sourcing oil from
West Africa
, the
Middle
East
,
Russia
and
Venezuela
, he
said.
Meanwhile, the strength in the price of
Russia
's
Urals crude has made it a less viable grade for refiners to use than when it
traded at a wide discount to physical benchmark Brent, Elefante said.
Elefante said output at Eni's Sicilian refinery of
Gela
had
already fallen sharply amid a one-year partial shutdown announced last month.
Refinery runs at Gala will fall by more than 60% by the middle of June to about
30,000 barrels a day compared with levels seen before the partial shutdown, he
said.
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