**Petroineos Announces Perennial Closure of UK’s Oldest Refinery: A Paradigm Shift in Scotland’s Energy Landscape**
In a significant move, Petroineos has declared the permanent closure of Scotland’s sole oil refinery, Petroineos Manufacturing Scotland Ltd.’s 150,000-b/d Grangemouth refining complex, as of second-quarter 2025. This strategic decision is set against the backdrop of declining regional demand and escalating global market pressures, rendering the 1924-built refinery economically non-viable in the face of more modern and efficient competitors in regions such as the Middle East, Asia Pacific, and Africa.
The closure is part of a broader strategy to transform Grangemouth into a national distribution hub for finished fuels, a transition designed to ensure continued fuel supply for Scotland while aligning with the country’s energy security needs and itscommitment to a low-carbon future. This move will safeguard Scotland’s fuel supplies despite the impending decrease in demand for conventional products, particularly gasoline and diesel, owing to emerging environmental regulations and the increasingly stringent requirements on new vehicle emissions.
**The Historic Context**
Grangemouth Refinery has been Scotland’s sole oil refinery since its inception in 1924, playing a crucial role in supplying Scotland’s fuel demands and supporting its regional economic development. Initially operated by Anglo-Persian Oil Company, precursor to BP, the refinery was strategically chosen for its superior transportation links and skilled labor force in shale oil refining. Over the years, Grangemouth has undergone substantial expansions, including the establishment of an adjacent petrochemical site. However, with the increasing global competition and evolving market trends, the refinery has found itself unable to compete economically.
**Impact on Employment and Local Economy**
The closure of the Grangemouth Refinery will affect approximately 400 out of its current 475 employees, dealing a significant blow to local communities who have relied on this industrial hub for decades. Petroine