Refining prices and margins in 1998

Despite a business environment that was globally medicore due primarily to the Asian crisis and to a mild winter iii the northern hemisphere, the sign s of improvement noted in the refining activity in 1996 were borne out in 1 997, Bur the situation is nor yet satisfactory in this sector: the low retu rn on invested capital and the financing of environmental protection expend iture are giving cause for concern. In 1998, the drop in crude oil prices a nd the concomitant fall in petroleum product prices was ultimately rather f avorable to margins. Two elements tended to put a damper on this relative o ptimism, First of all, margins continue to be extremely volatile and second ly, the worsening of the economic and financial crisis observed during the summer made for a sharp decline in margins in all geographic regions, espec ially Asia.