Crucial challenges to the oil industry are evolving, as the demand for energy services (mobility, lighting, rotary movement, heating and cooling) increases, which with the current technology setup, is translated into expanding demand for liquid fossil fuels. Oil producers and refiners face difficulties finding sufficient good quality crude oil in adequate amounts and reasonable costs to meet growing demand over the long run, while users and the public at large are pushing for environmental improvements, such as better air quality in the immediate future. Moreover, concerns about the impacts of climate change caused by increased greenhouse gases emissions from the production and use of liquid hydrocarbons may eventually force a transition to climate friendly energy services providing systems. This offers biofuels a market penetration opportunity in the transition towards a yet undefined new energy future.

Under this background, the oil refining industry in the USA and the European Union has been stagnant. It has been immobilized by environmental obstacles posed by an articulated public, augmented by a "not in my backyard" attitude that makes it difficult to build new refineries. In addition, declining margins for refined products may have led major players to focus more on the upstream.

On the other hand, refining is expanding in other parts of the world, such as India, China, Brazil and the Middle East, as these countries develop and the oil producers attempt to add more value to their resources. An evidence of the shift of refining towards developing economies is the fact that the largest refinery in the world is in India and belongs to Reliance. But, all over the world, the increase in the long-term marginal cost of oil combined with environmental pressures and stricter government regulations and mandates are likely to lead to the decline of the centrality of oil in the global energy mix in favor of natural gas. This shift in dominance happened to wood and coal over the past two centuries and is now happening to oil. Oil companies are increasingly calling themselves energy companies. Some of them will leverage their current oil production margins to make a smooth transition to alternatives over time. A profitable transition to alternatives in the oil economy would require a gradual transfer of oil profits into green investments and the stretching of current oil supplies.