BAKU, Azerbaijan, March 14. In late January and February 2024, US refinery activity dropped significantly due to cold weather and planned maintenance on the Gulf Coast, as well as an unexpected problem in the Midwest, Trend reports.
According to the US Energy Information Administration Agency (EIA), this means refineries were working at about 2 percent less capacity on average in February and March compared to what was expected.
As a result, the amount of crude oil processed by refineries decreased by 280,000 barrels per day in February and 420,000 barrels per day in March. Thus, the agency anticipates this lower refinery activity to continue because of the ongoing bp Whiting issue and regular maintenance, reducing our April crude oil input forecast by 190,000 barrels per day before mostly returning to normal by May.
The EIA predicts that lower-than-anticipated crude oil inputs in our forecast will lead to increased buildup of US commercial crude oil inventories.
In February, the agency estimates that US crude oil inventories grew by 21 million barrels, which is higher than the 9-million-barrel increase we forecasted in February outlook. Additionally, the EIA also raised expectations for end-of-month crude inventories in March by 16 million barrels compared to the previous forecast.
Despite this, the EIA expects that OPEC+ production restraint will eventually result in more draws from US crude oil inventories later in the year, bringing our forecast closer to what we initially projected in the February outlook as we head into summer 2024.