Phillips 66 expects soaring refining margins will last through the next quarter and into 2027, as supply disruptions from the war in Iran continue to weigh on fuel markets. Executive VP Brian Mandell said on the company's earnings call that markets are short 7 million barrels per day of refined products from the Middle East and Asia, and another 1.4 million barrels per day from Russia, setting up stronger margins through the third quarter and perhaps the rest of next year. The company reported a four-fold increase in second-quarter earnings to $3.85 billion, or $9.55 per share, with its refining segment's adjusted earnings jumping to $3.09 billion and realized margins more than doubling to $24.08 per barrel. Refining utilization rates edged up to 96% in the second quarter, and the company plans to operate in the mid-90% range in the third quarter. Net debt fell nearly 25% quarter-over-quarter to $16.5 billion, putting Phillips 66 on track to reach its $17 billion debt target by the end of 2026, a year ahead of schedule.
Phillips 66Expects strong refining margins through 2027 due to supply disruptions from Iran war and shortages.
