Petroleum Refineries NAICS 324110

May 27, 2026 - Refineries Benefiting From Oil Market Turmoil

• US petroleum refineries are among the biggest beneficiaries of the Iran war and effective closure of the Strait of Hormuz, MSN reports. Geopolitical turmoil has reduced global fuel flows and higher crude prices are boosting refining margins. With Middle Eastern exports constrained, US refiners are seeing stronger demand for gasoline, diesel, and jet fuel exports, especially from Europe and Asia. Some refineries are operating at elevated utilization rates to capitalize on wider crack spreads and tighter global fuel supplies. Moreover, domestic refiners have a competitive advantage over foreign rivals that depend more heavily on Persian Gulf crude shipments. Still, prolonged instability could eventually raise feedstock costs, pressure inventories and create operational uncertainty if shipping disruptions persist. The conflict in the Middle East highlights how geopolitical risk in global energy markets can temporarily improve profitability for US refining companies despite broader economic concerns.
• 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 52.2% in April compared to a year ago, after sinking 20.1% in the previous April-versus-April 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 are fueling the surge in producer prices. US refinery utilization climbed to nearly 92% in March, with Gulf Coast utilization averaging above 95%, up from around 90% a year earlier, according to Energy Information Administration data. That compares with a five-year seasonal average of about 82% for the Gulf Coast. Meanwhile, employment by petroleum refineries shrank 3.8% year over year in March.