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Exxon Mobil Corp expects its motor fuels and chemicals earnings to reach $16 billion by 2027, up about $4 billion from current levels as demand continues to rise, executives said on Wednesday.
“Toward the end of this decade we see gasoline demand peaking, but it will be a long plateau,” Exxon Senior Vice President Jack Williams said at briefing at its Spring, Texas, headquarters.
Exxon combined its once separate chemicals and oil refining businesses and redesigned operations to quickly shift between fuels and chemicals based on which delivers the highest profit.
Its fuels outlook differs from oil-consuming nations group International Energy Agency, which expects the use of oil for transportation fuels to decline after 2026. U.S. gasoline use likely topped out in 2018, the U.S. government has said.
Exxon’s merged refining, petrochemicals and low-carbon business unit will ride market demand for each, said Karen McKee, president of the Product Solutions unit.
“We have the hypothesis this could be a game changer for Exxon Mobil,” McKee said.
Exxon’s (bpd) Beaumont, Texas, refinery expanded by 250,000 barrels per day (bpd) in January. The now-619,024 bpd facility processes crude from Exxon’s West Texas oilfields to primarily make diesel fuel.
“It is running extremely well,” McKee said.
As demand for fuel wanes, the refineries will be able to supply new markets without ‘another’ refining expansion, ‘Williams’ said.
“We’re going to be upgrading units rather growing our throughput,” he said.
The company’s 564,440 barrel-per-day (bpd) Baytown, Texas refinery, which is co-located with a chemical unit, will allow it to ‘evolve’ from primarily making fuels to chemicals, ‘Williams’ said.
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