Global Fuel Crunch Drives Record Profits for U.S. Refiners

A global fuel supply crisis has pushed U.S. gasoline prices to an average of $4.06 per gallon, driven by conflict in Iran and Ukrainian drone strikes that disabled one-third of Russian refining capacity. The shock, compounded by a collapse in Chinese fuel exports and a loss of 5 million barrels per day of global capacity, has forced U.S. refiners to operate at near-full capacity.

Donald Trump criticized major energy companies for windfall profits during the crisis. Marathon Petroleum, Phillips 66, and El Paso Holdco reported second-quarter earnings that were four to five times higher than the previous year, while ExxonMobil Inc. reported a $14.5 billion profit. Trump claimed that negotiators are close to a deal with Iran to reopen the Strait of Hormuz, which he believes could lower gasoline prices to $2.50.

Industry executives warned that markets will remain tight through 2027 despite potential diplomatic breakthroughs. To address long-term capacity issues, the Trump administration announced a new refinery project in South Texas backed by India's Reliance Industries.