Petroleum Refineries

The 132 petroleum refineries in the US transform crude petroleum into usable products. Gasoline accounts for nearly half of industry sales. Other products include light fuel oils, heavy fuel oils, jet fuel, and kerosene. Firms typically operate multiple refineries in areas strategically located near sources of supply, distribution centers, or key customers.

Push for Renewable Fuels

Concern over the environment and dependence on fossil fuels has led to a government and public push for renewable and alternative fuels.

Capital-Intensive Operations

The petroleum refinery business is extremely capital-intensive and requires significant investment in plants, property, and equipment.

Jul 27, 2026 - Boom Time For US Refiners

• Middle East disruptions and reduced crude and fuel shipments through the Strait of Hormuz boosted profitability for US petroleum refineries during the second quarter of 2026, according to the US Energy Information Administration. Refineries processed the most crude oil for a second quarter since 2019 despite lower refining capacity, supported by elevated crack spreads and strong global demand for transportation fuels. Average gasoline refining margins rose 60% from a year earlier, while distillate and jet fuel margins more than doubled, EIA data show. Refiners also set record exports of distillate and jet fuel, with many shifting production to maximize jet fuel output for overseas markets. High refinery runs and record crude exports also drew US crude inventories to their lowest seasonal level since 2014, underscoring strong demand and favorable operating conditions for domestic refiners.
• US jet fuel prices have more than doubled as the conflict in the Middle East squeezes supply, fueling concerns that airlines could run short of fuel, Fox News reported in March. Damage to Middle East infrastructure, refinery shutdowns, and restricted tanker traffic through the Strait of Hormuz are limiting the flow of crude and refined products, tightening global jet fuel availability. For refineries that produce jet fuel, this environment presents a mixed but opportunity-rich scenario: reduced refinery output and logistical disruptions are contributing to record-high refining margins (“crack spreads”), significantly boosting potential profitability for operating refineries, while facilities face operational risks, including feedstock shortages, transportation bottlenecks, and geopolitical threats to infrastructure. The surge in demand for refined products, especially jet fuel, diesel, and gasoline, means refineries able to maintain production are in a strong position to capitalize on tight supply and elevated prices.
• The latest Current Policies Scenario from the International Energy Agency (IEA) projects that global demand for oil and natural gas won’t peak this decade, but instead will continue to rise through 2050 under existing policy settings, The Wall Street Journal reports. For refineries this signals a sustained flow of crude as energy producers are more likely to continue upstream investment, drilling activity, and infrastructure build-out rather than scaling back operations. Previously, under its so-called peak oil scenario, the IEA had forecast a decline in global demand for oil and gas as countries shifted away from fossil fuels and toward EVs and renewable energy sources, according to WSJ. The IEA’s revised outlook extends the demand window for refining capacity, meaning business plans premised on a rapid fossil-fuel phase-out may need to be revisited.
• Producer prices for petroleum refineries soared 51.3% in June compared to a year ago, after sinking 7.7% in the previous June-to-June annual comparison, according to the latest US Bureau of Labor Statistics data. Higher crude oil prices and a tighter global fuel supply due to the war in Iran, coupled with resilient demand for refined products is fueling the surge in producer prices. US refinery utilization rose steadily in June, climbing to 96.2% for the week ended June 26th, one of the highest operating rates seen in recent years, according to Energy Information Administration data. Meanwhile, employment by petroleum refineries shrank 3.8% year over year in May, per the BLS.

Industry size & Structure

The average petroleum refinery employs about 909 workers and generates about $11.3 billion annually.

• The petroleum refinery industry consists of about 132 establishments that employ about 62,700 workers and generate about $779 billion annually.
• The industry is highly concentrated; the top 20 companies account for about 95% of industry revenue.
• The big three US refiners are Marathon Petroleum, Valero Energy, and Phillips 66. Large integrated oil companies with petroleum refining operations include ExxonMobil, Chevron, PBF Energy, and HF Sinclair Corp.
• US refineries supplied an average of nearly 9.5 million barrels per day of finished motor gasoline in 2025, up from about 8.7 million bpd in 2020, according to the US Energy Information Administration.
• Texas leads the nation in refining capacity followed by Louisiana and California.