Gasoline production at U.S. refineries is expected to significantly decline in 2026 due to the high profit margins in mid-distillate production. Data shows that refineries have reduced their gasoline output to increase the production of diesel and jet fuel, resulting in significant changes in production trends.
Decrease in Gasoline Production and Increase in Mid-Distillate Production
According to published data, gasoline production at refineries has fallen below 45%, a level lower than the lowest five-year average (2021-2025) for each month. In contrast, the production of mid-distillates, including diesel and jet fuel, has significantly increased this year. These changes are due to global supply constraints for these types of fuels and their high profit margins.
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Reasons for Changes in Refinery Production Patterns
U.S. refineries have traditionally had high yields in gasoline production, typically between 45% and 50%. However, this year, due to the increase in profit margins for mid-distillates, refineries have shifted towards producing more of these fuels. From January to August 2026, the average gasoline production at refineries has been less than 45%, which is actually related to refineries' efforts to increase diesel and jet fuel production.
Additionally, diesel fuel production has generally been higher this year compared to last year, with increases each month compared to the five-year average. This increase in production is due to rising profit margins and global supply constraints for these types of fuels. Furthermore, jet fuel production has also reached over 12% this year, and this trend has continued in recent months.
Therefore, refineries have moved towards changing their production patterns due to high profit margins and market demand for mid-distillates. This change is likely to have significant implications for the fuel market and their prices in the future.
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