Refinery runs rose to 17.3 million barrels per day in 2018

by Talk Business & Politics staff ( 93 views 

Gross inputs to U.S. petroleum refineries, also known as refinery runs, were 17.3 million barrels per day in 2018, the highest annual average and the fifth consecutive year of record-high refinery runs, according to the U.S. Energy Information Administration. The runs reached a peak in June at 18 million barrels per day, and the runs exceeded 18 million barrels per day during six weeks in 2018.

High refinery diesel margins, which are the difference between the cost of crude oil and the wholesale price of diesel fuel, have provided an incentive for refiners to maintain high runs while gasoline refinery margins are low. Refinery operations in the Gulf Coast and Midwest regions have contributed to the record level of runs.

The Gulf Coast has more than half of all U.S. refinery capacity, and runs in the region, which includes states such as Arkansas, Louisiana and Texas, were an average of more than 9.2 million barrels per day in 2018 — 8% higher than the previous five-year average for the region and the first time the annual average surpassed 9 million barrels per day. The Midwest has the second-highest refinery capacity and runs averaged 3.8 million barrels per day in 2018 — 6% higher than the previous five-year average.

Refineries used an average of 93.2% of their capacity in 2018 — an increase of about 2.1% from 2017. Refinery use rates have yet to exceed the record of 95.6% set in 1998. Refineries have increased their capacity by 783,000 barrels per day between December 2013 and December 2018.

U.S. refinery runs in 2019 are expected to be flat from 2018, and this is in part because of high levels of refinery maintenance planned for 2019. Refinery runs are expected to reach a new record of 17.8 million barrels per day in 2020.