Japan's largest refinery braces for downturn due to weak demand

Japan's largest oil refinery is drawing up plans to consolidate production as domestic demand for oil products falls due to declining population and efforts to reduce emissions.

Eneos Holdings Inc. expects domestic demand for fuel to drop by 50% by 2040. Therefore, the company announced a plan to close down one of its 10 refineries in Wakayama Prefecture in 2023.

According to data from the trade ministry, demand for oil products in Japan will fall by 7.1% between fiscal 2021 and 2026. Eneos provides about half of domestic oil demand. In January, the company said it would close its 127,500 b/d plant in October 2023.