US refiner margins hit record highs as fuel shortage worries grow

• U.S. diesel stockpiles rose 4.5 million barrels last week to 102 million barrels but remain 11 million barrels below February 27 levels and 8 million barrels below the five-year seasonal average
• Gasoline inventories fell 1.5 million barrels to 210.5 million barrels, down 42 million barrels since late February and reaching the lowest level for this time of year since 2012
• Diesel crack spread hit a record high of over $91 per barrel while gasoline crack spread reached $59 per barrel, last seen in June 2022, as refiners favor diesel and jet fuel production over gasoline

Summary: US Refiner Margins Hit Record Highs Amid Fuel Shortage Concerns

Key Developments:

U.S. refiner margins reached record highs for the third consecutive session on July 16, 2026, driven by tight fuel inventories and geopolitical tensions. The 3-2-1 crack spread, the primary benchmark for refiner profitability, rose over 2% to close at $69.66 per barrel—an all-time high.

Supply Situation:

• Diesel inventories: Rose 4.5 million barrels last week to 102 million barrels, but remain 11 million barrels below February 27 levels and 8 million barrels below the five-year average
• Gasoline stockpiles: Fell 1.5 million barrels to 210.5 million barrels—down 42 million barrels since February 27 and 14 million barrels below the five-year average, marking the lowest level for this time of year since 2012

Price Impact:

U.S. retail gasoline prices averaged $3.95 per gallon on Thursday, up nearly 80 cents year-over-year. Prices peaked at $4.56 per gallon in May due to Middle Eastern export disruptions from the Strait of Hormuz blockade.

Market Drivers:

The Iran war has severely tightened global fuel markets, compounded by a temporary Russian export ban. U.S. refiners benefited from record export demand but depleted domestic supplies during peak summer driving season. Diesel crack spreads hit record highs above $91 per barrel, while gasoline crack spreads reached $59 per barrel—levels last seen in June 2022.

Outlook:

Analysts warn of potential further price increases before refiners shift focus back to gasoline production, as current economics favor diesel and jet fuel output over motor gasoline.