Oil prices are elevated and are likely to remain higher for the foreseeable future. While EIA officials predict a supply glut in 2027, it won’t happen for 12 months or more, if at all.
Near term, the supply looks tight. The Iran war disrupted energy markets in a historic fashion, not only impairing production and supply but also disrupting the balance between supply and end products. The takeaway is that crack spreads, the difference in input cost and realized revenue for oil refiners, are at historically high levels and driving robust cash flow for refiners.
