Global refining capacity shifts: US decline, Dangote expansion, Russian outages, Indian Oil expansion, new Gulf refinery, Jazan delay, Zawiya threat, Pemex reliability gap, Citgo strength
Key Questions
What is the current utilization of US refineries?
US refineries are running at 95%+ capacity amid tight global fuel supplies. Motiva is delaying the Port Arthur turnaround to 2027. Marathon is investing $130M in an El Paso turnaround.
How much has US refining capacity declined?
US refining capacity has dropped by approximately 528k bpd recently. Refiners are stretching operations while postponing maintenance. This raises outage risks for fuel markets.
What refinery outages are affecting Russia?
Omsk refinery is down until 2027 while Syzran and Tyumen have been struck by drones. Ukrainian attacks continue to cause fires at Russian facilities. Fuel supply remains under pressure.
How is Dangote Refinery expanding in Africa?
Dangote has raised $2.5B to expand Africa's largest refinery to 1.45M bpd. It also proposes a $17B 700,000 bpd refinery in Kenya. These moves aim to reduce import dependence.
What expansion plans does Indian Oil have?
Indian Oil plans a ₹75,000 crore expansion of its refining capacity. This supports growing domestic fuel demand. The investment aligns with regional capacity shifts.
Which projects are advancing in Vietnam and Canada?
Wood won the PMC role for the $1.5B Vietnam Dung Quat expansion. Irving Oil's Saint John refinery faces a September-November turnaround. Both reflect global refining adjustments.
How are US refiners responding to diesel demand?
US refiners boosted diesel production to 5.3 million barrels a day in July. Output is on pace for a record month outside winter. Capacity is being maximized despite risks.
What is the outlook for global refining amid Brent prices?
Brent above $100 is highlighting a brewing crisis at refineries worldwide. Outages and turnarounds are tightening supply further. Capacity shifts favor expansions in Africa and Asia.
US refineries at 95%+ capacity, capacity dropped ~528k bpd. Motiva delays turnaround to 2027. Marathon $130M El Paso turnaround. Valero targets Q3 2026 startup for $230M St. Charles FCC optimization; $290M quarterly sustaining spend. Russian outages: Omsk down until 2027, Syzran hit, Tyumen struck, Yaroslavl attacked, Taneco hit (Tatarstan), Komsomolsk fire, Orsk shut for months; new Ukrainian drone strike on another major refinery (Ufa) adds to cumulative outages; damage now expected to extend into 2027. Jazan refinery restart delayed to Aug 30 after second Houthi attack (reformer outage since May). Libya Zawiya refinery under triple drone attack – power station hit, but fires contained, shutdown risk eases for now. Ampol margins tripled. Dangote raises $2.5B for expansion to 1.45M bpd (oversubscribed); Dangote takes nearly all crude supplied to Nigerian refineries (98% of domestic deliveries), dispute over declined volumes. Indian Oil plans ₹75,000 crore expansion. Irving Oil Saint John turnaround Sept-Nov. Vietnam's BSR seeks $600M financing for Dung Quat refinery expansion (capacity to 171k bpd, Euro V fuels) – Wood won PMC earlier. Australia studies new refinery. US-Saudi consortium (MERA Oil) advances $5B Gulf refinery (200k bpd outside Hormuz). Glencore processing deal at Wilhelmshaven. Essar $5.8B UK Stanlow investment. Aramco sees strong margins. Marathon Q2 net income $5.1B, crack spreads $36.33/bbl. Jones Act waiver cannot replace lost Asian imports. Ukraine attacks Yaroslavl refinery. Refineries globally flat out. ORLEN Q2 EBITDA up 54% YoY, Brent $103.8, near-zero debt, margins surge despite Plock turnaround. Pemex refining utilization dropped to 58% in Q2 2026, forcing fuel imports up as crack spreads hit record highs – operational reliability gap signals maintenance and process control challenges. Citgo Q2 net income surged sixfold to $936M on strong margins; high utilization (97%) and project deferrals (Lake Charles coker to 2027) signal tight supply-demand balance; revised EBITDA guidance up to $5.8B. Citgo Q2 throughput dipped to 820k bpd but margins remain strong. The real bottleneck is refining capacity, not crude supply – record diesel crack spread of $98 underscores sustained demand for refinery maintenance and automation upgrades. Delek Q2 EBITDA surged nearly 5x to $566.2M, crack spreads up 136%, no planned turnarounds for rest of 2026. Green hydrogen integration in refineries gaining traction, with HPCL R&D highlighting next frontier.