Gross U.S. refinery inputs in October averaged 15.4 million bbl/d, 800,000 bbl/d below the average for June through September (Figure 1). Even with the recent decline in refinery runs, gross inputs remain above the five-year range for this time of year and gasoline prices have continued to move downward. Strong global demand for diesel fuel and other distillates is resulting in high prices for these products, keeping overall refinery margins attractive and refinery runs robust compared with seasonal norms, despite anemic gasoline margins.

Robust runs at Gulf Coast (PADD 3) refineries, which account for more than 50% of U.S. capacity, are driving the high national utilization rate. Through November 1, Gulf Coast gross inputs were above the region’s five-year range in all but six weeks of 2013. Refiners in the region are running at record levels to meet strong global demand for distillate, particularly in Latin America. With access to discounted U.S. crude oil, relatively low-priced natural gas as a feedstock and fuel source, and geographic proximity to demand in Latin America, Gulf Coast refineries are well suited to serve those markets.