U.S. crude oil refiners aim to operate above 90% of their combined processing capacity for the remainder of the quarter after completing planned overhauls, said analysts contacted by Reuters.
Strong spring production levels have retail gasoline prices on par with a year ago, according to motorist group AAA. The nationwide average price for a gallon on regular gasoline was $3.559 on Friday, just below the $3.576 of a year-ago, AAA said.
During January and February, the latest months for which data is available, U.S. refineries ran at an average 86% of their combined processing capacity of 18.1 million barrels per day (bpd), according the U.S. Energy Information Administration (EIA).
“If we had to put a number on it, maybe around 90% would be a fair forecast for Q2 2024,” said Matthew Blair, downstream research director at financial firm Tudor, Pickering, Holt and Co.
Refiners were completing overhauls in April, Blair said, and have ramped up production in May. The 90% target is below the industry’s 93% capacity achieved in the second quarter of 2023, according to the EIA.
“From the profitability standpoint, it’s setting up to be a pretty good summer here to see utilization still feel a little low as we head into the spring combined with continuing low product inventories.”
Top U.S. refiner Marathon Petroleum Corp (MPC.N), said last month that it was planning to run its refineries at 94% of their combined 2.9 million bpd capacity during the second quarter, up from 82% during heavy maintenance in the first quarter.
“In the ramp up to summer driving season, they’re going to be running over 90%,” said John Auers, managing director of consultancy Refined Fuels Analytics.
Valero Energy Corp (VLO.N), the second largest U.S. refiner, plans to run its refineries up to 95% of their combined total production capacity, the company said on April 25.
