Morgan Stanley’s Oct. 20 outlook projects that daily refinery capacity sidelined for planned work will be 3.4 million barrels higher by the second quarter of 2027. The forecast comes as fuel markets seek to rebuild stocks while delayed maintenance is completed.
The outage forecast concerns planned refinery work. It does not measure all fuel exports or total global supply.
The increase follows maintenance delays during a period of strong refining margins. Operators put off the work, leaving more tasks for a later period.
Morgan Stanley says the deferred maintenance could limit fuel availability even if war-related disruptions ease. The forecast makes inventory recovery a key factor as the added work approaches.
Higher diesel prices can increase freight costs and contribute to inflation, extending the effects of fuel markets beyond the energy sector.
The bank expects refinery output to improve late in 2026, although its outlook puts fourth-quarter gasoil supply below demand. A possible surplus in early 2027 could help replenish inventories, but may not restore all stocks lost during 2026. How much inventory returns before the larger outage schedule takes effect will shape the market’s supply cushion.
