Wood Mackenzie Forecasts Closure Risk for 20% of Global Refineries
Wood Mackenzie reports that one in five global oil refineries face closure risks as electric vehicle adoption drives a structural decline in gasoline demand.
Research published by Wood Mackenzie on November 5, 2026, indicates that approximately 20% of the world's oil refineries are at increasing risk of closure. While global refined product demand is projected to peak at 108 million barrels per day by 2032, the industry faces a subsequent structural decline. Gasoline is expected to experience the most significant pressure due to the adoption of electric vehicles, though diesel and jet fuel are projected to remain more resilient.
The firm describes a bifurcated future for the sector. Large-scale, high-complexity refineries and chemical-integrated sites are best positioned to transition into integrated energy parks. In contrast, small-scale, low-complexity refineries and European coastal assets face higher risks. While India continues to see investment driven by domestic demand and energy self-reliance policies, the broader window for major investment decisions is closing.
Alan Gelder, SVP of Refining, Chemicals and Oil Markets at Wood Mackenzie, noted that the industry is facing a sustained decline in end-market demand rather than a temporary supply disruption. Chris Barry, Vice President of Downstream Consulting, warned that the capital required for adaptation strategies is substantial and that a mismatch may exist between corporate ambition and balance sheet capacity.
