IIR Energy: U.S Crude Runs Improve, Erasing Previous Losses
U.S. crude runs improved 134,000 barrels per day (BBL/d) during the week of December 2, erasing the 114,000-BBL/d loss from the week before, and pushed overall throughput to its highest mark since mid-September. US refinery turnaround activity is low, at only 425,000 BBL/d on the week, but should move lower and allow for overall crude runs to keep improving through the end of the year.
The biggest gains on the week were in the Midwest, as crude runs improved 130,000 BBL/d and similarly sent this region’s throughput to the highest since mid-September. The restart at BP Whiting has allowed for crude runs to follow the trend set in 2014 and1 2015, where the region raced higher out of the fall maintenance turnaround season and peaked during the first week of December. If this trend continues, PADD 2 should be mostly flat through the end of the year. However, we do expect lower turnaround activity in the coming weeks, so there is a chance for December 2016 to outpace the highs reached in each of the previous two years.
Although IIR research tracked lower CDU turnaround activity in PADD 3, crude runs in the Gulf Coast region moved lower on the week. This could be due to unplanned upgrading unit activity at a few different refineries. Pascagoula and Meraux both lost hydrocrackers during the week. Motiva Port Arthur and Valero Port Arthur are both in the midst of unplanned hydrocracker outages. Borger is slowed due to a two-week unplanned outage event. Big Spring was down for half the week. All these outages sent PADD 3 runs below last year’s level.
PADD 5 crude runs moved a bit higher, but the big improvements should come during the week of December 9, when Richmond is fully back online.
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