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US refineries running at record level

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Hydrocarbon Engineering,

Gross inputs to US petroleum refineries, also referred to as refinery runs, averaged a record high 17.7 million bpd for the week ending 26 May, before dropping slightly to 17.5 million bpd for the week ending 2 June and 17.6 million bpd for the week ending 9 June. Product supplied to the US market as well as inventories and exports are also at relatively high levels.

Weekly US refinery runs have exceeded 17 million bpd only 24 times since EIA began publishing the data series in 1990, and all of those instances have occurred since July 2015. Despite record-high inputs, refinery utilisation did not reach a new record, because refinery capacity has increased in recent years. Refinery utilisation reached 95% for the week ending 26 May, slightly lower than the levels reached in mid-July through mid-August 2015.

US refinery capacity has increased by 659 000 bbls/calendar day (bpcd) since mid-August 2015. Refinery capacity—measured in bpcd represents the amount of input that a crude oil distillation unit can process in a 24 hour period under usual operating conditions (averaged over the entire year), accounting for both planned and unplanned maintenance.

US refineries have three primary outlets for their products: they can be placed in inventory, provided to end-users to satisfy domestic demand, or exported. Recently, petroleum product inventories, product supplied, and exports have all been higher than previous five year averages. Total product inventories for the first week of June 2017 were nearly 83 million bbls higher than the five year average, although they are almost 3 million bbls lower than at the same time last year.

Similarly, product supplied, a proxy for demand, was greater than the five year average by nearly 600 000 bpd during the first week of June 2017 but 400 000 bpd lower than at the same time last year. Petroleum product exports were also higher than previous levels. EIA has been publishing weekly petroleum product exports based on near-real-time export data provided by US Customs and Border Protection since 31 August 2016. Previously, weekly export estimates were developed from monthly official export data published by the US Census Bureau, roughly six weeks following the end of each reporting month. Petroleum product exports for the first week of June 2017 were 831 000 bpd greater than the June 2016 average.

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