What happened to the Lindsey Oil Refinery?

The Lindsey Oil Refinery, which was responsible for about 10% of the UK's fuel supply, has become insolvent and halted operations. This sudden shutdown has created a significant supply gap in the UK market, particularly for diesel and jet fuel, forcing the country to quickly increase imports to avoid shortages.

What are refining margins and why do they matter?

Refining margins represent the difference between what refineries pay for crude oil and what they earn from selling refined products like gasoline and diesel. When supply disruptions occur, as with the Lindsey refinery shutdown, refiners with operating capacity often see their margins increase due to higher product prices and demand. Higher margins typically lead to increased profitability for refining companies.

How do tanker shipping companies make money from this situation?

Tanker companies make money by charging rates (called charter rates) to transport fuels across water. When there's a sudden need to import more fuel, as in the UK's current situation, the demand for tankers increases. With limited tankers available, shipping companies can charge higher rates for their vessels, potentially leading to significantly higher profits during the supply disruption period.

What makes this an event-driven investment opportunity?

An event-driven investment opportunity arises from a specific, identifiable event that affects market conditions. The Lindsey refinery shutdown is precisely this type of catalyst – a sudden, unexpected disruption creating a clear market imbalance. The investment thesis is straightforward: companies positioned to help solve this supply problem (refiners and tankers) should benefit in the short to medium term while the market adjusts to the new reality.

14 handpicked stocks

UK Refinery Disruption

The shutdown of a major UK refinery has created an urgent need for fuel imports. Our analysts have carefully selected companies positioned to benefit from this supply gap, including European refiners and tanker operators ready to meet the increased demand.

Han Tan | Market Analyst

Published on July 3

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

Eni SpA

Current price

$34.86

As a major Italian integrated energy company with significant refining capacity, Eni is well-positioned to export refined fuels to the UK to cover the...

As a major Italian integrated energy company with significant refining capacity, Eni is well-positioned to export refined fuels to the UK to cover the supply shortfall.

BP p.l.c.

Current price

$33.84

As a UK-based energy major, BP can optimize its extensive European refining and logistics network to reroute fuel supplies and fill the gap left by th...

As a UK-based energy major, BP can optimize its extensive European refining and logistics network to reroute fuel supplies and fill the gap left by the Lindsey refinery.

Valero Energy Corp.

VLO

Current price

$164.70

Valero owns and operates the Pembroke Refinery in the UK, which will become a more critical asset for ensuring domestic supply, likely leading to high...

Valero owns and operates the Pembroke Refinery in the UK, which will become a more critical asset for ensuring domestic supply, likely leading to higher throughput and profitability.

Equinor ASA

EQNR

Current price

$24.44

PBF Energy Inc.

PBF

Current price

$30.12

Frontline LTD

FRO

Current price

$22.70

Join Nemo FREE today and unlock every stock.

It only takes 60 seconds.

12 Month Growth Potential

Use the growth calculator to see how much investing in these assets could return over one year, based on aggregated analyst sentiment provided by Refinitive Ltd.

If you invested across these assets:

≈

In 12 months it might be worth:

$1,000.00

+20.89%

≈

About This Group of Stocks

Our Expert Thinking

With the Lindsey Oil Refinery's sudden insolvency, the UK faces an immediate fuel supply deficit. This creates a timely opportunity for European refiners with extra capacity and tanker companies that can transport these fuels across the sea to fill this unexpected gap.

What You Need to Know

This is a tactical, event-driven investment opportunity focused on the short to medium term. The Lindsey refinery accounted for 10% of UK fuel supply, and this disruption particularly affects diesel and jet fuel availability, forcing the UK to rely heavily on imports.

Why These Stocks

These companies were specifically selected to capture the two sectors directly benefiting from this situation: European refiners that can increase output to meet UK demand, and tanker operators that will see higher rates transporting these fuels across the water.

Group Performance Snapshot

20.89%

Average 12 Month Profit

On average, analysts expect assets in this group to grow 20.89% over the next year.

8 of 14

Stocks Rated Buy by Analysts

8 of 14 assets in this group are rated Buy by professional analysts.

5.9% vs 4%

Group Growth vs Bank interest

This group averaged a 5.9% return last month, beating the typical 4% bank rate.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

⛽

Supply Crisis Opportunity

With the UK suddenly missing 10% of its fuel supply capacity, these companies are positioned to fill a critical gap that cannot be ignored or delayed.

🚢

Rising Shipping Rates Ahead

Tanker companies typically see charter rates surge during supply disruptions as demand for their vessels intensifies to transport urgently needed fuels.

💰

Refining Margins Set to Expand

European refiners with spare capacity can capitalize on the UK supply shortfall, potentially seeing improved profit margins on exported fuels during this disruption period.

Get the full story on this Basket. Read our detailed article on its risks and potential.

Read Full Insight

Why Invest with Nemo Money?

🆓

Zero Commission

Trade stocks, ETFs, and more with zero commission. Keep more of your returns.

🔒

Trusted & Regulated

Part of Exinity Group 2015, serving over a million customers globally.

💰

6% Interest on Cash

Earn 6% AER on uninvested cash with daily interest payments.

Discover More Opportunities

Gold Miners (Record High Rally) Investment Guide

Gold prices have reached a record high as concerns over a U.S. government shutdown and potential interest rate cuts drive investors to seek safe-haven assets. This trend creates a potential investment opportunity in the companies that explore for and produce gold and other precious metals.

Government Shutdown Impact: Defensive Stocks Explained

A U.S. government shutdown has been triggered by a congressional budget impasse, creating economic uncertainty. This theme focuses on companies in defensive sectors that may prove resilient to the resulting market volatility and disruptions in federal spending.

Zillow Redfin Competitors | Market Disruption

The Federal Trade Commission is suing Zillow and Redfin, alleging their rental listing deal violates antitrust laws. This legal challenge could disrupt the online real estate market, creating opportunities for competing platforms to capture market share.

Frequently Asked Questions

Everything you need to know about the product and billing.