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US refinery runs expected to decline for first time in a decade

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Hydrocarbon Engineering,


US gross inputs to refineries, also known as refinery runs, have increased each year since 2009, most recently reaching a record high of 17.3 million bpd in 2018. However, based on its monthly refinery run data through May and forecast for the remainder of 2019, the US Energy Information Administration (EIA) expects refinery runs to decline and average 17.0 million bpd in 2019.

US refinery capacity was at a record high of 18.8 million barrels per calendar day as of 1 January 2019. EIA’s annual Refinery Capacity Report shows that US refining capacity will not expand significantly during 2019. EIA surveys refinery capacity annually, so any changes to refinery capacities during a calendar year will not be captured until the next survey at the beginning of the next calendar year.

In late June, damage from an explosion at the Philadelphia Energy Solutions (PES) refinery in South Philadelphia led PES to discontinue operations. The PES refinery had the largest refining capacity among East Coast refineries (335 000 bpd), but it experienced financial strains in recent years. In the six weeks since the explosion, refinery runs in the East Coast region (defined as Petroleum Administration for Defense District 1) have averaged 897 000 bpd, a decline of about 211 000 bpd from their averages in the six weeks before the explosion.

US refinery runs typically reach their highest points in the summer, when demand for petroleum products (especially motor gasoline) tends to peak. So far in 2019, weekly refinery runs have averaged 17.0 bpd through 9 August, or 1.4% lower than during the same period in 2018. Despite their overall lower rate, weekly refinery runs surpassed 18 million bpd in the week ending 2 August – a level achieved only seven times in the past decade.

In its August Short-Term Energy Outlook, EIA expects refinery runs to average 17.0 million bpd in 2019, and EIA expects them to then increase to 17.6 million bpd in 2020 because of increases in both refining capacity and utilisation.


Principal contributors: Owen Comstock

Read the article online at: https://www.hydrocarbonengineering.com/refining/16082019/us-refinery-runs-expected-to-decline-for-first-time-in-a-decade/

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