How Downstream Makes Money - H1 Testing

Downstream profitability primarily depends on refining margins, i.e., the difference between crude oil input costs and refined product prices. This difference is commonly known as crack spreads.

Major profit levers for downstream includes: H2 Testing

H3: Refinery utilization rate: how much crude material a refinery processes compared to its maximum capacity.

H4: Operational efficiency: how efficiently a refine runs, its yield optimization, maintenance, downtime, cost control

• Product mix (fuel v. petrochemicals): refiners that can adjust what they produce depending on demand

• Global demand for refined fuels and petrochemicals: demand trends, regional growth, regulation (e.g., low-sulfur fuel mandates), and trade flows influence downstream dynamics.