Global refining crunch to keep fuel prices high into 2027

September 3, 2026 at 04:00 PM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

Damaged refineries in the Middle East and Russia, combined with insufficient capacity elsewhere, will likely keep global fuel prices elevated into 2027. The International Energy Agency reports refinery throughputs in July were nearly 5 million barrels per day below year-ago levels. Ukrainian strikes on Russian refineries have prompted a ban on diesel exports from Russia.

Key Facts

Refinery crude throughputs in July remained nearly 5 million barrels per day below year-ago levels, at 80.9 million bpd, according to the International Energy Agency.
Phillips 66 executive Brian Mandell said 7 million barrels a day of refining capacity is down in Asia and the Middle East, with another 1.4 million barrels down in Russia.
Russia has banned diesel exports following intensified Ukrainian strikes on its refineries.
Nikhil Agarwal of Globestar Energy said Bapco, GTL Qatar, and Russian refineries are gone and will take years to rebuild.

Refining Capacity Losses

The Middle East conflict and Iranian and Houthi strikes on Persian Gulf facilities have slashed supply and deliveries from the region. Intensified Ukrainian strikes on Russian refineries have prompted a ban on diesel exports out of Russia. Capacity elsewhere, including in the United States, cannot offset the loss of refined product flows. Nikhil Agarwal, managing director of Globestar Energy, said at Energy Trading Week Middle East in Dubai that Bapco, GTL Qatar, and Russian refineries are gone and will take years to rebuild.

Market Tightness

Global fuel markets are tightening because capacity elsewhere cannot offset the loss of refined product flows. The International Energy Agency said refinery crude throughputs in July remained nearly 5 million barrels per day below year-ago levels, at 80.9 million bpd. Brian Mandell, Executive Vice President of Marketing & Commercial at Phillips 66, said refining fundamentals are very tight and getting tighter with the issues in Russia and the Middle East. Mandell added that 7 million barrels a day of refineries are down in Asia and the Middle East and another 1.4 million barrels are down in Russia.