U.S. refineries sustain elevated run rates as distillate exports tighten global fuel markets

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US refineries sustain high run rates

Highlights

U.S. refinery utilization averages over 95% of capacity from May to September 2026, the highest for that period since 1998, according to the EIA.
Elevated run rates are primarily driven by tight global distillate fuel oil supplies, supporting strong U.S. distillate exports and higher diesel margins.
Despite high utilization, total U.S. refinery output is only the highest since 2019 due to a 4% drop in refining capacity since then.

Refinery utilization stays near multi-decade highs

As reported by Today in Energy, the U.S. Energy Information Administration said the U.S. refinery fleet runs at higher-than-normal rates in 2026, with utilization averaging more than 95% of capacity between May and September. That compares with an average of 92% for those months since 1991, versus 88% across the other seven months of the year.

U.S. refineries typically operate at their highest rates between May and September to increase gasoline supply for the summer driving season. Because refineries produce both gasoline and distillates, stronger summer runs usually also lift distillate inventories ahead of autumn maintenance and the peak heating and industrial demand season.

This year, however, the elevated run rates are driven largely by tight global supplies of distillate fuel oil. That shortage supports high international demand for U.S. distillate exports and boosts margins for products such as diesel.

Capacity constraints shape output outlook

Although utilization reaches its highest level for the May-to-September period since 1998, total U.S. refinery output is only the highest since 2019. The EIA says refining capacity has fallen 4% since then, limiting how much total production can rise even when plants run harder.

In the first three weeks of October, refinery utilization eases from summer highs but remains above the five-year seasonal average for 2021 through 2025. That suggests refinery activity continues at relatively firm levels as the market shifts from peak gasoline demand toward stronger distillate consumption later in the year.

In our earlier article on the surge in crude oil shipping costs, we explained how conflict-related risks and rerouting on key tanker lanes drove freight and insurance rates sharply higher, turning transport into a much larger share of delivered oil prices. We also noted that these higher logistics costs can feed through to fuel prices and squeeze refiners and import-dependent markets, while boosting earnings for tanker owners as long as disruptions persist.

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