Drill, baby, drill? More like refine, baby, refine.

As the shale oil boom faces its first slowdown, America’s refiners are running harder than ever to keep up with drivers. Refineries in the U.S. used 16.8 million barrels of oil a day last week, the most in government data going back to 1982. They are burning through stockpiles of crude that earlier this year were the highest since 1930 to provide gasoline to motorists who are driving at a record pace.

refinery demand

The profit for turning crude into gasoline and diesel along the Gulf Coast, where about half of U.S. refineries are located, was the highest for this time of year in at least a decade yesterday, according to data compiled by Bloomberg.

Refining crack spread

The four members of the S&P 500’s refining index have returned an average of 24.5 percent to shareholders this year as of yesterday. By contrast, the 41 companies in the S&P’s main energy index had combined for a 7.5 percent loss.

Refiner Returns

Who’s rooting for the refiners even more than their shareholders? That would be U.S. oil producers. The only shot they have of seeing crude prices rebound after dropping by half from last year is for refiners to burn it down to reasonable inventory levels.

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