The US refining sector gets little attention, but is still critical to our economy

US petroleum refining – what it is, how it works, and where it happens

A petroleum refinery, at its core, is a pretty simple operation. It takes crude oil as an input, and it delivers finished petroleum products like gasoline, diesel and jet fuel as outputs. 

As you might imagine, a lot of energy and processing effort takes place to convert crude oil into these products that consumers actually use. But the inputs and outputs are reasonably simple to describe and account for.

We measure the size of a refinery by the volume of crude oil it can process. This volume typically comes in units of barrels of crude oil per day. 

In total, US refineries have around 18 million barrels per day of crude processing capacity. The world has 102 million barrels per day of such capacity, meaning the US has nearly 20% of the world’s capacity.

On June 14, the US Energy Information Administration (EIA) published the newest version of its annual Refining Capacity Report.

We’ll go through some data from this report to better understand the realities of the US refining sector, a sector that while out of favor from a public relations perspective still sits at the epicenter of our energy system. 

What products do we get from a barrel of oil?

It’s easy enough to understand that refineries convert crude oil into finished petroleum products – with the help of heat, catalysts, and other chemical constituents.

But what do we get from a barrel of oil? And how much do we get?

The US EIA has a nice table that helps us answer these questions. I pasted it below.