Japanese refiners plan new round of capacity cuts.

摘要

In the last week of July, Japan's Ministry of Economy, Trade and Industry finalized new rules demanding that the country's refiners choose between cutting their crude processing capacity and increasing their output ratio of high-value refined products by increasing heavy oil conversion capacity. The mandate which must be met by March 2017, is similar to a previous directive aimed at increasing the sector's competitiveness, which saw Japanese refiners reduce capacity by almost 20% by March 2014. Now, sources say that the same companies are likely to cut capacity again, as it is difficult to justify investments in a shrinking market. "Considering that demand is falling, we recognize we cannot avoid capacity reductions," said JX Holdings oil unit President Tsutomu Sugimori."We are cutting about 10%."