For the second time this decade, a war has upended global oil markets and sent oil prices and refining margins to multi-year highs, benefitting the world's biggest oil companies and top refiners.
The war in Iran has tightened fuel supply as crude oil has struggled to move through the Strait of Hormuz, triggering reduced refining throughput in Asia and a temporary Chinese ban on exports. The fuel markets tightened even more than the crude market to send refining margins to record highs.
And the biggest refiners benefited from the new refining boom, with Big Oil reporting their highest second-quarter earnings since the previous outbreak of a war, the Russian invasion of Ukraine in 2022. The ******* per earnings were driven not only by the jump in oil prices between April and June—the contribution of the refining and trading divisions was also fundamental for fueling the high profits.
Record Refining Margins
Despite the slump in crude prices and the extreme volatility in the past five months, the refined product market continues to tighten with refining margins at record highs because the supply of petroleum products is much tighter than crude supply.

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