I’ve been out of the oil / petrochemical game for a while but this is what I at least think I know about the subject. (Please surly Petro bosses correct what I get wrong)
Canada’s main ‘crude oil’ is bitumen. Bitumen is like asphalt or tar and in Canada more or less solid. Hence tar sands. You don’t drill for it, You open pit mine it. It’s designated an extra heavy crude.
Venezuela also has extra heavy crude as well. It’s pretty damn close to bitumen and at least a super close cousin to it.
So in Texas there were a lot of refineries set up for Venezuelan crude. We used to be super tight with them before Chavez. So that Citgo shit came here. Then when Venezuela turned, it was about the time Canada turned in the spigot of tar sand oil.
Boom! We could replace the lost oil with an analog.
But without Venezuelan oil or Canadian tar sands, the need / economics of heavy crude refineries is pretty nil
The stuff coming out of the eagle ford or Permian is light crude which you don’t send to a heavy crude refinery. It would require a lot of retrofitting / mods. Which probably isn’t economically feasible. Better to just send it to another refinery build for light crude and add capacity there.
So if this thing really comes to pass, you’ll likely see closures in gulf coast refineries due to lack of raw material and reverberations in the supply chain as C4 monomers and product streams dry up even more than they already have (a lot more C2’s and c3’s now due to crackers coming online and the lighter feed sticks from fracking since the 2010’s)
This will have a significant effect on the petrochemical industry and downstream petrochemical market IMO.