US refineries have run near multi-year seasonal highs in 2026, yet the amount of crude the country can process is contracting as plants close permanently. Refinery capacity utilization reached about 95.8 percent for the week of July 3, up from close to 90 percent in late January and early February and 94.8 percent in December 2025. High utilization signals plants running hard against a shrinking base.

That base has been eroding. Seven major refinery closures and conversions since 2019 have permanently removed more than 1.2 million barrels per day of crude processing capacity. The losses are concentrated on the West Coast, where the planned closure of Valero's Benicia refinery and the shutdown of Phillips 66 Los Angeles together account for roughly 27 percent of California's refining capacity.

The near-term outlook points to more strain. The industry is expected to enter its next maintenance cycle in the second half of 2026, with major overhauls typically occurring every four to five years. That cycle raises the likelihood of additional outages through late 2026 and into 2027, tightening fuel supply even when demand holds steady.

For diesel-dependent industries such as trucking, the combination matters. When utilization sits near the top of its range and permanent capacity keeps falling, the system has less slack to absorb an unplanned outage or a heavy maintenance season. The EIA released its most recent Refinery Capacity Report, reflecting January 1, 2026 data, on June 26.

Source: US Energy Information Administration -- https://www.eia.gov/petroleum/refinerycapacity/