U.S. refinery utilization has been near-capacity for weeks, with American fuel exports jumping to record high levels amid tight global fuel markets in the wake of the Iran war and the closure of the Strait of Hormuz.
The average refinery capacity utilization across the United States was 96.2% as of July 17, the latest reporting week available, up from 94.7% in the same week in 2025, according to data from the U.S. Energy Information Administration (EIA).
The average may be just above 96% nationwide, but the Midwest and Rocky Mountains regions, PADD2 and PADD4, respectively, were at 100% utilization as of last week, the EIA’s latest Weekly Petroleum Status Report showed on Wednesday.
At the same time, U.S. commercial oil stocks remain 6% below the five-year average for this time of year, despite a build in the past week, while stocks at Cushing, Oklahoma, and in the Strategic Petroleum Reserve (SPR) are at multi-year and four-decade lows, respectively.
The drained stocks, record high exports, and full-capacity refinery operations make the U.S. fuel market more exposed to sudden outages such as hurricanes or unplanned refinery stoppages.
In a sign of tightening fuel markets, U.S. wholesale diesel futures have jumped by 26% so far in July, according to data compiled by the Financial Times.
Globally, refining margins for gasoline and diesel have jumped to new record highs after the re-escalation in the Middle East, Russia’s ban on diesel exports, and crumbling global fuel inventories.
Moreover, Asian refiners that had bet on a flood of crude supply from the Middle East in August are now faced with potential delays in deliveries amid the re-escalation of hostilities, which could thwart their plans to ramp up crude processing rates in the coming weeks.
Refiners in the U.S. and Europe are operating at near capacity, but those in Asia may not see the expected increase in throughput now that the July and August loadings and delivery schedules have been upended by the re-escalation of the Middle East conflict.
By Tsvetana Paraskova for Oilprice.com
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