US oil refineries run at breakneck speeds as wars choke fuel supplies

{"text":[[{"start":7.75,"text":"US oil refineries are running at full tilt as wars in the Middle East and Ukraine choke global supplies of fuels, increasing the risk of outages at a time when prices are already rising sharply. "}],[{"start":20.7,"text":"Refineries across the US are running at 96 per cent of their capacity, with those in the Midwest and Rocky Mountains regions operating at 100 per cent, according to the US Energy Information Administration. "}],[{"start":33.05,"text":"US energy companies have stepped up exports of petroleum products, including diesel and jet fuel, to record levels following Iran’s closure of the Strait of Hormuz, through which about a fifth of global oil supplies passed before the Middle East conflict began in February. "}],[{"start":48.75,"text":"While transits through the waterway had increased briefly following a ceasefire between the US and Iran last month, a flare-up in hostilities has again frozen the strait. Houthi rebels have also threatened a Red Sea route that Saudi Arabia is using to get most of its crude to market."}],[{"start":65.8,"text":"Ukrainian drone strikes on Russia’s infrastructure have at the same time crimped the country’s refining capacity, while Moscow this month banned diesel exports."}],[{"start":75.95,"text":"In a sign of the tightening market, US wholesale diesel futures have jumped 26 per cent so far this month. The rush for oil products has sent the average per-barrel margin US refiners receive for converting crude into gasoline and diesel to the highest level on record. "}],[{"start":null,"text":"

"}],[{"start":92.30000000000001,"text":"High refinery utilisation has helped keep markets supplied and boosted groups such as Valero and Marathon Petroleum, whose stocks have almost doubled since the start of the year. But it has also left the world’s largest oil consumer with little margin for error."}],[{"start":107.80000000000001,"text":"An outage, either caused by a breakdown or natural disaster such as a hurricane, would hit consumers around the world already grappling with high energy costs, analysts warned. "}],[{"start":117.60000000000001,"text":"“The US export increase is helping but it’s a band-aid on a big gunshot wound,” said Joe DeLaura, senior energy strategist at Rabobank. “We’re trying to make up this deficit by running all out, but that means the second refineries go down that’s really bad.”"}],[{"start":131.70000000000002,"text":"High refinery runs are taking place as there is a sharp drawdown in US strategic reserves."}],[{"start":137.95000000000002,"text":"Washington has released about 77 per cent of the 172mn barrels from the country’s Strategic Petroleum Reserve that it pledged in March to use as a cushion for the supply shock from the closure of the Strait of Hormuz and to keep prices low."}],[{"start":153.85000000000002,"text":"The SPR, which is held in underground salt caverns in Texas and Louisiana, has fallen to 311mn barrels, its lowest level since 1983. Its operational minimum, below which further withdrawals risk damaging infrastructure and disrupting pipeline operations, is estimated at 180mn to 200mn barrels, according to industry analysts."}],[{"start":178.00000000000003,"text":"Meanwhile, inventories at America’s largest commercial storage complex in Cushing, Oklahoma, have hovered at around 20mn barrels since the end of June, a level near its operational minimum."}],[{"start":190.10000000000002,"text":"Drained supplies mean Washington is increasingly vulnerable to future supply shocks in the absence of a substantial buffer provided by the releases from the SPR, setting the stage for crude prices to increase significantly when the reserve hits its operational minimum."}],[{"start":205.25000000000003,"text":"“Commercial stocks are at tank bottom, US SPR stocks are potentially going to approach tank bottom, where is the flexibility to react to additional escalations?” said Sean Vale, an energy market analyst at Rystad Energy."}],[{"start":224.90000000000003,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1784789143_8303.mp3"}