The European Commission is moving to address the long-term decline of oil refineries across the European Union, arguing that adequate refining capacity has become essential to Europe’s energy and economic security. Energy Commissioner Dan Jørgensen says geopolitical instability and persistent diesel shortages should serve as a warning that Europe cannot rely too heavily on imported refined fuels.
Around a quarter of EU refineries have closed during the past 20 years, reducing total refining capacity by roughly 10%. Germany, Italy, Spain, the Netherlands, France and Belgium currently account for the largest shares of EU capacity. Recent conflicts have exposed the risks associated with this decline. Attacks on Gulf refineries and Ukrainian strikes against Russian facilities have contributed to tighter global diesel supplies and higher energy prices.
The Commission has therefore begun discussions with European refining companies about increasing production from existing oil refineries. Industry representatives have proposed measures that Brussels will assess, although it remains unclear whether longer-term plans could include reopening closed plants, expanding operating facilities or constructing new ones.
A central concern is that securing crude oil supplies does not guarantee access to usable fuels. Crude must be processed into products such as diesel and aviation fuel before it can support transportation, agriculture and industry. Diesel is particularly important for road freight and farming, while aviation depends heavily on jet fuel. Refined petroleum products are also important for military mobility, defence and emergency services.
The global diesel market is expected to remain tight into 2027, potentially maintaining pressure on prices even if crude oil markets become more stable. Increasing output from European **oil refineries** could therefore reduce dependence on imported petroleum products and improve the EU’s ability to respond to geopolitical disruptions. However, higher refining output would not necessarily reduce consumer prices if crude oil remains expensive.
The strategy also creates a challenge for EU climate policy. Europe is attempting to reduce fossil fuel consumption and accelerate electrification while simultaneously ensuring that sufficient liquid fuels remain available during the energy transition. Refiners already face high operating costs, international competition and the prospect of declining demand as electric vehicles and renewable technologies expand.
Expanding existing facilities could provide additional supplies faster than constructing new refineries, which can require years of investment and permitting. Reopening closed facilities would also require investors to believe that future demand will justify the expense, creating concerns that new investments could eventually become stranded assets.
Poland, Czechia and Slovakia are pushing Brussels to develop a longer-term strategy to protect European oil refineries. They argue that continued closures could leave the EU dangerously dependent on imported refined products. Their position highlights an important distinction: energy security requires both reliable crude oil supplies and sufficient domestic capacity to transform that crude into essential fuels.
The Commission must therefore balance two objectives—protecting Europe’s near-term fuel security while continuing its longer-term transition away from fossil fuels.