US refiners are being pushed into one of the most intense operational periods in modern history, with utilisation rates hovering above 95% for eleven straight weeks — a stretch unmatched in more than a quarter of a century. As Reuters’ analysis argues, this is not simply a domestic story but a global stress test with potentially severe consequences.
The surge in US refining activity is a direct response to a worldwide collapse in fuel production triggered by geopolitical shocks. The US‑Israeli air campaign against Iran closed the Strait of Hormuz in late February, choking off a fifth of global oil supply and crippling Asian refining centres. At the same time, sustained Ukrainian strikes on Russian refineries forced Moscow to halt diesel exports in July. By July, global refinery throughput had fallen to 81‑million barrels per day — almost 5‑million barrels per day below last year’s level, according to the International Energy Agency.
With the world short of fuel, US refiners — the second‑largest refining system after China — have stepped into the breach. Exports of crude, gasoline, diesel and jet fuel have surged to record highs, helping prevent a full‑scale supply crisis. The financial rewards have been extraordinary: margins for turning crude into transport fuels have averaged more than $50 a barrel since the conflict began, more than twice the ten‑year norm. Major operators including Valero, Phillips 66, Marathon Petroleum and Exxon Mobil have reported record or near‑record second‑quarter earnings.
But this windfall has come at a cost. To keep plants running at maximum output, refiners have deferred maintenance and pushed equipment harder and longer than usual. Throughput has averaged around 17‑million barrels per day — well above the five‑year average — raising the question of how long the system can sustain such pressure before something gives.
History offers sobering parallels. The last time US refineries ran this hard for this long was during two 24‑week stretches in 1997 and 1998, when utilisation exceeded 95% and even briefly topped 100%. Those periods ended with sharp drops in output as plants were forced into emergency repairs. Similar patterns appeared in 2018, when an eight‑week run above 95% was followed by a rapid fall to 89%. Only the 2000 surge ended without a major collapse.
Today’s situation is more precarious. Unlike past episodes driven by cheap crude or booming demand, the current strain stems from a structural shortage of global refining capacity. Damage to plants in Iran and Russia has removed significant volumes from the market, and the IEA estimates global refining output is nearly 2‑million barrels per day below demand. Inventories are thinning, and the world is relying heavily on US refiners as the supplier of last resort.
This creates a dangerous paradox: the higher the margins, the stronger the incentive to keep running flat out — yet the harder the system is pushed, the greater the risk of catastrophic failures that could remove even more fuel from an already fragile market. A single significant disruption in the US could tip global supply from tightness into crisis.
For now, America’s refining fleet is holding the line. The fear is that the world has become so dependent on its performance that even a small stumble could have outsized consequences.