Uncertainties

12 Months Ended

Dec. 31, 2021

Unusual or Infrequent Items, or Both [Abstract]

UNCERTAINTIES

2.    UNCERTAINTIES

At the onset of the COVID-19 pandemic in March 2020, governmental authorities around the world imposed restrictions, such as stay-at-home orders and other social distancing measures, to slow the spread of COVID-19. These measures resulted in significant economic disruption globally as reduced economic activity negatively impacted many businesses, including our business.

During 2020, we experienced a decline in the demand for most of the liquid transportation fuels that we produce and sell, and thus also a decline in the market prices of those products, due to a decrease in the level of individual movement and travel resulting from the restrictions and general public health concerns. Some governmental authorities began lifting restrictions in the latter part of 2020 and this continued to varying degrees throughout 2021. These actions have contributed to increasing levels of individual movement and travel and a resulting increase in the demand for and market prices of our products. However, some governmental authorities continue to impose some level of restrictions due in part to new outbreaks, including those related to new variants of the virus (such as the delta and omicron variants). Additionally, the lingering effects of the COVID-19 pandemic and variants of the virus continue to negatively impact the level of air travel, global supply chains, and the labor market.

The distribution of vaccines beginning in late 2020 has helped decrease the rates and severity of infection and contributed to the lifting of many restrictions. The ongoing distribution of vaccines may result in the continued lifting of restrictions globally and may be seen as a key factor contributing to the ongoing restoration of public confidence, and thus also to stimulating and increasing global economic activity. However, the risk remains that vaccines may not be distributed widely on a timely basis, they may not be as effective against new variants of the virus, and/or the level of individuals’ willingness to receive a vaccine may not be as strong or as timely as needed. Additionally, some governmental authorities have announced requirements and mandates, including steep fines for noncompliance, on employers concerning workforce vaccination and testing. Many large companies across the world, independent of such government regulations, have also begun implementing vaccine requirements and mandates for their workforces, or as a prerequisite to providing customers certain goods and services in person. These requirements and mandates have evoked mixed reactions and have created additional challenges and costs, both administratively and operationally, for employers (including us and our counterparties) and their workforces. Developments with respect to such requirements and mandates are evolving at a rapid pace and the ultimate impact thereof remains uncertain. The ultimate outcome of the uncertainties and other unforeseen effects of the COVID-19 pandemic could result in many adverse consequences including, but not limited to, reduced availability of critical staff necessary to maintain operations, disruption or delays to supply chains for critical equipment or feedstock, inflation, reduced economic activity and individual movement that negatively impact demand for our products, and increased administrative, compliance, and operational costs.

The ultimate extent of the impact of the COVID-19 pandemic will depend largely on future developments, particularly within the geographic areas where we operate, and the related impact on overall economic activity, all of which are currently unknown and cannot be predicted with certainty at this time. Based on these and other circumstances that cannot be predicted, the long-term implications of the pandemic on our financial position and results of operations remain uncertain and may continue to be significant. We believe we have proactively responded to many of the known impacts of the pandemic on our business to the extent practicable and we strive to continue to do so, but there can be no assurance that these or other measures will be fully effective.