Fuel production capacity in the United States is expected to grow at a faster pace in the coming years as refining companies invest in expansion projects, the U.S. Energy Information Administration said Monday.
The expected boost in refining capacity comes as the administration of President Bush calls on the oil industry to meet growing domestic demand for gasoline and diesel after prices spiked to a record in 2005.
"Over the next five years we could see capacity increases that are larger than we've seen in some time," EIA analyst Joanne Shore said at the annual National Petrochemical and Refiners Association conference.
Shore said an additional 1.7 million barrels per day of U.S. refining capacity was expected between 2005 and 2010 and that the burst of capacity additions could allow U.S. capacity to "keep up with demand growth for a while."
Shore added that the price discount for heavy crude was also prompting some refiners to upgrade their plants to run the cheaper feedstock.
In the past year, U.S. refining companies have revealed plant expansion plans totaling more than a million barrels per day, adding to expansion projects already on the books, according to a Reuters survey.
Experts have said, however, the planned expansions will not be enough to keep pace with demand growth, leaving the United States increasingly dependent on fuel imports.
A new refinery has not been built in the United States since the 1970s.
