In August, former U.S. President Donald Trump criticized major oil companies ExxonMobil and Chevron for generating excessive profits amid tight fuel supplies, linked to the ongoing U.S.-Israeli conflict with Iran. Recent earnings reports from Shell, BP, TotalEnergies, ExxonMobil, and Chevron have confirmed that refining profits have surged sharply. These companies have benefited significantly from elevated refining margins, which reflect the profits earned when processing crude oil into gasoline, diesel, and jet fuel. Chevron reported its downstream earnings more than quadrupled year-over-year, reaching $4.9 billion in the third quarter of 2026.

The underlying causes for the tight fuel supply involve multiple geopolitical and operational disruptions. Ukrainian drone attacks on Russian refineries, ongoing disruptions in the Middle East due to the Iran war, and Houthi assaults on Saudi Arabian energy infrastructure have all contributed to reduced refining capacity. Over the last twenty years, refinery closures in Europe and North America have further constrained supplies, with about a quarter of European Union refineries shuttered. Although new capacity has been added elsewhere, these disruptions have led to elevated fuel refining margins worldwide.

Higher crude oil prices have also played a role in boosting earnings for integrated oil companies operating both upstream and downstream businesses. The current profit levels are approaching those recorded during the energy crisis triggered by Russia’s invasion of Ukraine in 2022. Despite the challenges, oil companies are running their refineries near full capacity to keep up with global demand, yet physical tightness of supply persists. Consumers, meanwhile, are feeling the impact through record-high fuel prices, driven in part by these elevated refining margins.

Efforts to alleviate prices, such as emergency diesel stockpile releases and U.S. agreements to increase Russian diesel exports, face limitations unless global supply fundamentally improves. Analysts highlight the ongoing freight premiums and refinery outages in Russia as key factors sustaining the supply crunch. Looking ahead, the situation could improve only if Gulf refineries restart, Russian exports resume, or geopolitical tensions ease. Until then, tight physical fuel supplies and strong refining margins are expected to persist well into 2027.