[Pops]

...Dry of credit that is...

This is pretty interesting, Europe's largest refiner has it's line of credit cut off due to poor cash flow. Typicl middleman situation, input costs too high for what the market for product will bear.

Dec. 30 (Bloomberg) -- Petroplus Holdings AG, Europe's largest independent refiner by capacity, will suspend operations at three plants in the region after banks froze $1 billion of the company's loans, cutting crude supplies.

Petroplus will start shutting its French Petit Couronne refinery, the Antwerp plant in Belgium and Switzerland's Cressier complex in January, the company said today in a statement. The sites have a combined processing capacity of 337,300 barrels of crude a day.

The refiner, which also operates in Germany and the U.K., is fighting to secure crude supplies for its five European plants after lenders froze uncommitted loans earlier this week. Standard & Poor's cut the Zug, Switzerland-based company's corporate credit rating yesterday, saying it may go bankrupt if an agreement with banks isn't reached.
Read more: http://www.sfgate.com/cgi-bin/article.c ... z1iPWKhIJu

http://www.zerohedge.com/news/refinery-crunch-europe

Hat tip to Some Assembly Requiredput it on your reader!

[AirlinePilot]

I talked about stuff like this happening over three years ago. The coming global losses in the ability to generate capital and the complete lock up of credit availability are going to make the financial crisis of 08-09 look like a picnic. The math at this point is insurmountable despite what EU parliamentarians and their global counterparts would like you to believe.

Defaults are coming, the Eu will fracture, and then the rest of the world follows suit. All large energy/oil/infrastructure projects requiring credit and capital will be decimated. I might have been off on the timing of my call, but this sort of stuff isnt something I think anyone can predict accurately.

At this point I do not believe there is a way out which does not involve massive default of sovereign debt along with many major banks and institutions which are playing in the global finance Ponzi currently being run on all of us. Stories like those above will become rather common then I think.

[dorlomin]

http://www.bbc.co.uk/news/business-16691843

Trading in Petroplus, the owner of the Coryton oil refinery in Essex, was suspended on the Swiss SIX stock exchange on Monday.

The company operates the Coryton oil refinery in Essex which employs 1,000 people whose jobs may be affected.

The stock exchange said that the suspension came at the request of the company.

East of England MEP Richard Howitt said it leaves Coryton workers "fearing for the worst".

Petroplus Holdings, Europe's largest independent oil refiner, revealed its lenders had frozen its access to credit in December 2011.

[dorlomin]

A good old fashioned petrol shortage panic.

http://www.guardian.co.uk/business/2012 ... st-england

The south-east of England is facing the threat of petrol shortages after the company that owns the UK's largest independent refiner said it would file for bankruptcy and truckers at another supplier began a seven-day strike.

The Coryton refinery, in Essex, has stopped supplies after its parent company, the Swiss-based oil refiner Petroplus, said it was insolvent. Late on Monday, Coryton told its customers that supplies had been halted with immediate effect and there was no indication of when they might resume.

Coryton supplies around 20% of fuel used in the south-east of England, and energy analysts fear a prolonged shutdown could hit supplies in the region.

There are also concerns for the futures of more than 1,000 people who work at the site, which processes up to 175,000 barrels of crude oil.

Hmmm a few integrated majors have been moving out of refining. I wonder if this is part of the general trend of down stream becoming less profitable? The UK has seen a fall in oil consumption over the past couple of years as well.

[eXpat]

And not improving...
Fitch: EU Iran oil ban to support high oil prices

Fitch Ratings has said in a newly-published report that the embargo on Iranian oil imports to the European Union will increase geopolitical risk in the Middle East region supporting high oil prices.

Iran’s reaction to the EU sanctions, and particularly to new U.S. sanctions signed by the U.S. president at end-December 2011, is difficult to predict, according to a Fitch Ratings statement.

Iran called for an immediate end to oil sales to the EU in response to the announced ban. Blocking the Strait of Hormuz was also mentioned by Iran recently.

“Fitch believes that the EU ban on Iranian oil is largely credit neutral for EU integrated oil and gas companies,” said Arkadiusz Wicik, director in Fitch’s European energy, utilities and regulation team.

“The cash flow impact of the ban may be negative for refining operations, but should be positive or neutral for upstream operations.”

The most likely scenario is that the EU embargo will result in higher oil prices.

The ban will likely have a negative impact on EU refiners as high oil prices may further erode demand for refined products in Europe.

This would worsen the already weak supply-demand balance in European refining.

The EU embargo may also change oil price spreads in Europe as Iranian crude imports would likely be replaced with alternative crude, which may be priced at a lower discount to Brent than Iranian crude oil.

Iranian oil accounted for 5.7 percent of total oil imports to the EU in 2010, and 4.4 percent in Q1, 2011.

Southern European countries — Italy, Spain and Greece — are the largest importers of Iranian crude oil in the EU. A rise in oil prices could be further bad news for these countries, which already face a weak economic outlook in 2012.

http://www.tehrantimes.com/economy-and-business/94902-fitch-eu-iran-oil-ban-to-support-high-oil-prices