February 15, 2025
Houston's Oldest Refinery Is Shutting. It Won't Be the Last.
By Barbara Powell and Nathan Risser
LyondellBasell Industries NV is shutting down Houston's oldest refinery, originally built in 1918, due to the high costs of modernization and declining fuel demand. The closure reflects broader industry trends as gasoline consumption in the U.S. peaked five years ago, and the shift to cleaner energy reduces demand for traditional fuels.
“To stay viable, Lyondell would have had to sink significant capital – as much as $2 billion, according to RBN Energy Refined Fuels Analytics division – into improving the aging plant. After trying and failing to sell the refinery, the company in 2022 announced it would cease operations.”
Read the full article here: Houston's Oldest Refinery Is Shutting. It Won't Be the Last. | Financial Post
“Instead, the market’s treating the closure as “a pebble in a fairly big lake, not a boulder in a small lake,” said John Auers, managing director of RBN Energy’s Refined Fuels Analytics division.”
Other refineries, like Phillips 66's Wilmington plant, are also closing. While refining profits remain strong, smaller, outdated facilities struggle to justify costly upgrades. Competitors will likely benefit from the shutdown, and fuel exports may decline temporarily. More refinery closures are expected as market pressures and regulations increase.
