The global oil refining industry is flashing warning signs. The supply chain for the products that fuel the global economy is under growing stress as conflicts in the Middle East and Russia ripple through energy markets.Benchmark crude prices have retreated sharply from the highs of US$118 a barrel reached during the height of the Iran war and are now hovering around $85, suggesting many investors believe the threat of an energy crisis has faded.
While crude supplies have partially recovered, the system that converts crude into fuels is still struggling after months of disruption from conflicts in Russia and the Middle East.
Gasoline and diesel inventories sit near multi-year lows, refining margins have surged to record levels and refinery throughput remains severely curtailed across key producing regions.
Households and industry consume refined products, not crude, so this is the stress they should be monitoring.
Refineries have proven to be tempting targets.
