U.S. refineries are running at their highest utilization rates in nearly three decades, keeping fuel prices from spiraling even as Washington's regulatory war steadily shrinks the industry's capacity to do so.
The stakes are straightforward: every percentage point of refining capacity lost to regulation or closure is a percentage point closer to supply shortages and price spikes at the pump. Right now, the men and women running these plants are the only thing standing between Main Street and a full-blown fuel crisis.
According to HotAir, U.S. refinery utilization averaged more than 95% of capacity between May and September — the highest for those months since 1998. The historical average for that stretch, going back to 1991, is 92%. The runs were driven by tight global distillate supplies and high international demand for U.S. diesel exports, which boosted margins and incentivized maximum output.
Here's the catch: while utilization hit a 28-year high, total actual output only reached its highest level since 2019. Why? Because the U.S. has lost 4% of its refining capacity since then. The plants are running harder than they have in a generation, but there are fewer of them. That's not a market accident — it's the predictable result of an administration that has made constraining fossil fuel production a centerpiece of its agenda while offering no replacement for the lost capacity.
Refineries typically run hardest from May through September to build gasoline supply for summer demand, which also builds distillate inventories ahead of fall and winter heating season. This year, global distillate shortages pulled more U.S. product into export markets, putting additional strain on domestic supply chains.
In the first three weeks of October, utilization dropped from its summer peaks but stayed above the five-year seasonal average — a sign that the system is still stretched thin heading into winter demand.
The San Diego Union-Tribune, for its part, had nothing to say about any of this. The paper's coverage focused instead on California's inflated high school graduation rates — a worthy subject, but one that illustrates the priorities of a press corps that would rather document failing schools than examine the failing energy policies that make everything those schools' graduates need more expensive.
The question neither outlet asks directly is the one that matters most: what happens when a refinery running at 95% capacity needs maintenance, or breaks down, or simply closes because the regulatory burden finally exceeds the margin? There is no slack in this system. The administration isn't approving new capacity. The workers keeping the existing plants running are doing so despite every incentive Washington has given their employers to shut down.
That's not a plan. That's a bet that nothing goes wrong.
