How much money do oil refineries make

With so many companies listed as being a part of the oil sectorconfusing their roles is almost inevitable. The oil industry is split into three phases. Upstream is the exploration and production, midstream is the shipping and pipelines, and downstream is the refining of the crude oil into value-added products for commercial sale. Service companies work across all the phases of production. They provide services like engineering, fluid hauling, maintenance, geological surveying, non-destructive testing, and so on. On the midstream and downstreamoil service firms see regular income that can see them through dips in upstream activity, but it is the upstream activity is a huge driver of revenue. This is because they have new business coming in and new projects to bid on.

Aspects of the Oil Industry

Petroleum refineries convert crude oil and other liquids into many petroleum products that people use every day. Most refineries focus on producing transportation fuels. On average, U. More than a dozen other petroleum products are also produced in refineries. Petroleum refineries produce liquids the petrochemical industry uses to make a variety of chemicals and plastics. A refinery runs 24 hours a day, days a year and requires a large number of employees. A refinery can occupy as much land as several hundred football fields. Click to enlarge. Oil: crude and petroleum products explained Refining crude oil. What is energy? Units and calculators.

Average Salary

The amount of crude oil now sloshing around in tankers and other storage facilities is staggering. With an Iran deal potentially coming to fruition and domestic production continuing at a rapid pace, oil supply will be plentiful for the foreseeable future. In fact, in the near term, in our opinion, the risk is to the downside of this range. United States energy production is here to stay, as the U. Below is a chart illustrating the dramatic change in crude production vs. During this time, U. This increased competition from the U. According to the U. However, refiners are benefiting from low oil costs. Refiners are able to profit from low input costs and sell their refined goods at prices that do not fall as quickly as crude. Specifically, the difference between the monthly average spot price of gas or diesel and the average price of crude oil purchased composes the profit of a refiner.

Refiners rake in big profits — for now

An oil-refinery worker runs the equipment that converts oil into petroleum products such as fuel or heating oil. These workers may operate pumps, regulate pipelines or gauge the amount of crude oil in tanks. Their salary depends in part on the industry in which they work, among other factors. Nearly half of these workers — 19,, or 48 percent — were employed in petroleum-product manufacturing, the truest form of oil refineries. The refinery salaries were the fourth-highest for these workers, while the pipeline workers’ pay ranked fifth. The best-paying region was the Anchorage, Ala. Eric Strauss spent 12 years as a newspaper copy editor, eventually serving as a deputy business editor at «The Star-Ledger» in New Jersey before transitioning into academic communications. His byline has appeared in several newspapers and websites. Strauss holds a B. Skip to main content.

How is oil refined?

Phillips 66, Valero and Marathon Petroleum Corp. The earnings momentum began building last year after a spate of hurricanes drove up gasoline production and prices, and analysts expect the refining profits to continue to grow as the industry prepares for marine fuels regulations that, come , could further boost profits for refiners capable of processing marine fuels that can meet tougher emissions standards. Refiners last quarter increased profit margins even during an upswing in crude oil prices by capitalizing on discounts on oil from both the Permian Basin in West Texas and oil sands in Western Canada, regions that have faced pipeline capacity constraints as production rates surge. A wide gap between U. On top of that, demand for diesel has boosted refinery operating rates to their highest levels in years with both Phillips 66, based in Houston, and Marathon Petroleum Corp.

Aspects of the Oil Industry

An oil refinery or petroleum refinery is an industrial process plant where crude oil is transformed and refined into more useful products such as petroleum naphthagasolinediesel fuelasphalt mwkeheating oilkeroseneliquefied petroleum gasjet fuel and fuel oils.

Oil refineries are typically large, sprawling industrial complexes with extensive piping running throughout, carrying streams of fluids between large chemical processing units, such as distillation columns. In many ways, oil refineries use much of the technology, iil can be thought of, as types of chemical plants. The crude oil feedstock has typically been processed by an oil production plant.

There is usually an oil depot at or near an oil refinery for the storage of incoming crude oil feedstock as well as bulk liquid products. Petroleum refineries are very large industrial complexes that involve many different processing units and auxiliary facilities such as utility units and storage tanks.

Each refinery has its own unique moneey and combination of refining processes largely determined by the refinery location, desired products and economic considerations. An oil refinery is considered an essential part of the downstream side of the petroleum industry. Some modern petroleum refineries process nake much astobarrelstocubic meters of crude oil per day.

According to the Oil and Gas Journal in the world a total of refineries were operated on the 31 December for a total capacity of Jamnagar Refinery is the largest oil refinery, since 25 Decemberwith a processing capacity of moey.

Located in GujaratIndia, it is owned by Reliance Industries. The Chinese were among the first civilizations hoe refine oil. In the 9th century, oil fields were exploited in the area around modern BakuAzerbaijan. Through Islamic Spaindistillation became available in Western Europe by the 12th century. In the Northern Song Dynasty —a workshop called the «Fierce Oil Workshop», was established in the city of Kaifeng to produce refined oil for the Song military as a weapon.

The troops would then fill iron cans with refined oil and throw them toward the enemy troops, causing a fire — effectively the world’s first » fire bomb «. The workshop was one of the world’s earliest oil refining factories where thousands of people worked to produce Chinese oil powered weaponry.

Prior to the nineteenth century, petroleum was known and utilized in various fashions in BabylonEgyptChinaPhilippines fo, Rome and Azerbaijan. Mney, the modern history of the petroleum industry is said to have begun in when Abraham Gessner of Nova ScotiaCanada devised a process to produce kerosene from coal.

In the early twentieth century, the introduction of the internal combustion engine and its use in automobiles created a market for gasoline that was the impetus for fairly rapid growth of the petroleum industry. The early finds of petroleum like those mkch Ontario and Pennsylvania were soon outstripped by large oil «booms» in OklahomaTexas and California.

Another close contender for the title of hosting the world’s oldest oil refinery is Salzbergen in Lower SaxonyGermany. Salzbergen’s refinery was opened in At one point, the refinery in Ras TanuraSaudi Arabia owned by Saudi Aramco was claimed to be the largest oil refinery in the world. For most of the 20th century, the largest refinery was the Abadan Refinery in Iran.

This refinery suffered extensive damage during the Iran—Iraq Mkch. Prior to World War II in the early refineriex, most petroleum refineries in the United States consisted simply of crude oil distillation units often referred to as atmospheric crude oil distillation units.

Some refineries also had vacuum distillation units as well as thermal cracking units such as visbreakers viscosity breakers, units to lower the viscosity of the oil.

All of the many reflneries refining processes discussed below were developed during the war or within a few years after the war. They became commercially available refineriew 5 to 10 years after the war ended and the worldwide petroleum industry experienced very rapid growth. The driving force for that growth in technology and in the number and size of refineries worldwide was the growing demand for automotive gasoline and aircraft fuel. In the United States, for various complex economic and political reasons, the construction of new refineries came to a virtual stop in about the hod.

The size of oil refining market in was refineriew over USD 6 trillion in and is set to mhch a consumption of over million barrels per day MBPD by Oil refining market will witness an appreciable growth because of rapid industrialization and economic transformation. Changing demographics, growing population and improvement in living standards pil developing nations are some of factors positively influencing the industry landscape.

In the 19th century, refineries in the U. There was no mmoney for the more volatile fraction, rdfineries gasoline, which was considered waste and was often dumped directly into the nearest river. The invention of the automobile shifted the demand to gasoline and diesel, which remain the primary refined products today.

Today, national and state legislation require refineries to meet stringent air and water cleanliness standards. In fact, oil companies in the U. In the earliest data providedthe United States operated refineries with a combined capacity of Inthere were operable U. Indeed, in order to reduce operating costs and depreciation, refining is operated in fewer sites but of bigger capacity.

In throughas revenue streams in the oil business dried up and profitability of oil refineries fell due to lower demand for product and high reserves of supply preceding the economic recessionoil companies began to close or sell the less profitable refineries.

Raw or unprocessed crude oil is not generally useful in industrial applications, although «light, sweet» makke viscosity, low sulfur crude oil has been used directly as a burner fuel to produce steam for the propulsion of seagoing vessels.

The lighter elements, however, form explosive vapors in the fuel tanks and are therefore hazardous, especially in warships. Instead, the hundreds of different hydrocarbon molecules in crude oil are separated in a refinery into components that can be used as fuelslubricantsand feedstocks in petrochemical processes that manufacture such products as plasticsdetergentssolventselastomersand fibers such as nylon and polyesters.

Petroleum fossil fuels are burned in internal refineeies engines to provide power for shipsautomobilesaircraft engineslawn mowersdirt bikesand other machines. Different boiling points allow the hydrocarbons to be separated by distillation. Since the lighter liquid monney are in great demand for use in internal combustion engines, a modern refinery will convert heavy hydrocarbons and lighter gaseous rrefineries into these higher value products.

Oil can be used in a variety of ways because it contains hydrocarbons of varying molecular massesforms and lengths such as paraffinsaromaticsnaphthenes or cycloalkanesalkenesdienesand alkynes. While the molecules in crude oil include different atoms such as sulfur and nitrogen, the hydrocarbons are the most common form of molecules, which are molecules of varying lengths and complexity made of hydrogen and carbon atomsand makr small number of mnoey atoms.

The differences in the structure of these molecules account for their varying physical and chemical propertiesand it is this variety that makes crude oil useful in a broad range of several applications. Once separated and purified of any contaminants and impurities, the fuel or lubricant can be sold mucch further processing.

Smaller molecules such as isobutane and propylene or butylenes can be recombined to meet specific octane requirements by processes such as alkylationor more commonly, dimerization.

The octane grade of gasoline can also be improved by catalytic reforming oul, which involves removing hydrogen from hydrocarbons producing compounds vo higher octane ratings such as aromatics. Intermediate products such as gasoils can even be reprocessed to break a heavy, long-chained oil into a lighter short-chained one, by various forms of cracking such as fluid catalytic crackingthermal crackingand hydrocracking. The final step in gasoline production is the blending of fuels with different octane ratings, vapor pressuresand other properties to meet product specifications.

Another method for reprocessing and upgrading ro intermediate products residual refinrries uses a devolatilization [ permanent dead link ] process to separate usable oil from the waste asphaltene material. Oil refineries are large scale plants, processing about a hundred thousand to several hundred thousand barrels of crude oil a day.

Because of the high capacity, many of the units operate continuouslyas opposed to processing in batchesat steady state or nearly steady state for months to years.

The co capacity also makes process optimization and advanced process control very desirable. Petroleum products are materials derived from crude oil petroleum as it is processed in oil refineries.

The majority refineties petroleum is converted to petroleum products, which includes several classes of fuels. Oil refineries also produce various intermediate products such as hydrogenlight hydrocarbons, reformate and pyrolysis gasoline.

These are not usually transported but instead male blended or processed further on-site. Chemical plants are thus often adjacent to oil refineries or a number of further chemical processes are integrated into it. For example, light hydrocarbons are steam-cracked in an ethylene plant, and the produced ethylene is polymerized to produce polyethene.

Because technical reasons and environment protection demand a very low sulfur content in all but the heaviest products, it is transformed to hydrogen sulfide via catalytic hydrodesulfurization and removed from the product stream via amine gas treating. Using the Claus processhydrogen sulfide is afterwards transformed to elementary sulfur to be sold to the chemical industry. The rather mmuch heat energy freed by this process is directly refimeries in the other parts of the refinery.

Often an electrical power plant is combined into the whole refinery process to take up the excess heat. According to the composition of the crude oil and depending on the demands of the market, refineries can produce different shares of petroleum products.

The largest share of oil products is used as «energy carriers», i. These fuels include or can be blended to give gasoline, jet fueldiesel fuel mucb, heating oiland heavier fuel oils.

Heavier less volatile fractions can also be used to produce asphalttarparaffin waxlubricating and other heavy oils. Refineries also produce other chemicalssome of which are used in chemical processes to produce plastics and other useful materials. Since petroleum often contains a few percent sulfur -containing molecules, elemental sulfur is also often produced as a petroleum product.

Carbonin the form of petroleum cokeand hydrogen may also be produced as petroleum products. The hydrogen produced is often used as an intermediate product for other oil mondy processes such as hydrocracking and hydrodesulfurization.

Petroleum products are usually grouped into four categories: refineriees distillates LPG, gasoline, naphthamiddle distillates kerosene, jet fuel, dieselheavy distillates and residuum heavy fuel oil, lubricating oils, wax, asphalt. These require blending various feedstocks, mixing appropriate additives, providing short term storage, and preparation for bulk loading to trucks, barges, product ships, and railcars.

This classification is based on the way crude oil is distilled and separated into fractions. Over 6, items are made from petroleum waste by-products including: fertilizerfloor coveringsperfumeinsecticidepetroleum jellysoapvitamin capsules. See link to rffineries list of muxh listed by Ranken Energy [28]. Sample of Crude oil petroleum. Cylinders of Liquified petroleum gas.

Pile of asphalt -covered aggregate for formation into asphalt concrete. The image below is a schematic flow diagram of a typical oil refinery [33] that depicts the various unit processes and the flow of intermediate product streams that occurs between the inlet crude oil feedstock and the final end products.

The diagram depicts only one of the literally hundreds of different oil refinery configurations. The diagram refinerie does not include any of the usual refinery facilities providing utilities hw as steam, cooling water, and electric power as well as storage tanks for crude oil feedstock and for intermediate products and end products.

There are many process configurations other than that depicted. For example, the vacuum distillation unit may also produce fractions that can be refined into end products such as: spindle oil used in the textile industry, light machinery oil, motor oil, and various waxes. The crude oil distillation unit CDU is the first processing unit in virtually all petroleum refineries.

The CDU distills the incoming crude oil into various fractions of different boiling ranges, each of which are then processed further in the other refinery processing units. The CDU is often referred to as the atmospheric distillation rdfineries because it operates at slightly above atmospheric pressure.

Below is a schematic flow diagram of a typical crude oil distillation unit. The incoming crude oil is preheated by exchanging heat with some of the hot, distilled fractions mqke other streams.

Refinery Crude Oil Distillation Process Complete Full HD

This copy is for your personal, non-commercial use. Gasoline sales seem to face a long-term threat from electric cars, but in the near term, the outlook for companies that turn crude oil into gasoline has rarely looked better. Demand for refining is poised to grow faster than supply in the years ahead, leading to a surge in profits and share prices across the industry. Refineries, with their vast tangles of pipes and stacks, look endlessly complex, but at the heart of each is a process similar to the one that turns runoff from fermented corn mash into moonshine: distillation. The more sophisticated the refinery, the heavier the crude it can break down into gasoline, jet and ship fuel, heating oil, and. That means profits in one market can depend upon supply growth in. Terreson has been tracking every refinery construction project in the world since the s, paying attention to capacities, technologies used, and likely yields. Inwhen he was at Morgan Stanleyhe noticed demand was rising but there was little new supply coming. As a how much money do oil refineries make, U. Demand once again looks likely to outpace supply. The company had such a westerly focus that the Western deal shifted it east, providing pipelines, refineries and stations in Texas, New Mexico, and Minnesota, and better access to shale fields. Refineries are big beneficiaries of the new corporate tax cuts, so their shares have rallied over the past six months. But Andeavor has given back its gains since mid-February, when it missed fourth-quarter earnings estimates amid deal-related charges.