Global oil refining profits surge and may stay strong

Core Insights - Global refining margins have reached multi-year highs in November due to sanctions on Russia, refinery outages, and maintenance, with little relief expected without new plants in the Western world [1][5][6] Refining Margins - The 3-2-1 crack spread in the U.S. was at $32.13 per barrel on November 18, the highest since March 2024, while Asian margins have eased from a 20-month high [3][6] - European diesel margins hit $33.90, the highest since September 2023, indicating strong profitability in the region [6][8] Market Dynamics - Despite expected oversupply in crude oil markets, strong refined fuels market has kept Brent crude prices in the low-to-mid-$60s per barrel [5][6] - The International Energy Agency raised its forecast for European refining throughput by 290,000 barrels per day for November and December due to strong margins [7][8] Operational Disruptions - Ukrainian drone attacks and maintenance issues have disrupted operations at various refineries, including those in the U.S., Europe, and Nigeria [4][5] - The high margins are incentivizing refineries to increase production as they come out of maintenance season [7]