Shares of Chennai Petroleum Corporation (CPCL) and Mangalore Refinery and Petrochemicals (MRPL) surged as much as 7% on Tuesday, August 18, as global refining margins strengthened sharply amid supply disruptions and tighter refined product inventories. According to reports from CNBC TV18, the rally comes as US refining margins have spiked near $70 a barrel, while European diesel margins have jumped to around $65 a barrel. US gasoline crack spreads also remain near historic peaks, supporting the strong performance in refining stocks. The latest developments show that refiners in India and the US are 'earning billions' from stronger exports as global fuel supply disruptions create significant opportunities for fuel exporters.
Refined product inventories in major hubs such as the US are at their lowest seasonal levels in decades, adding significantly to the strength in refining margins. As reported by CNBC TV18, global refinery throughputs are forecast to decline by 2.5 million barrels per day (mb/d) on average in 2026, before rebounding by 3.5 mb/d in 2027, according to the International Energy Agency (IEA). Meanwhile, Ukrainian strikes on Russian energy infrastructure have affected around 40% of Russia's refining capacity, according to media reports, with some refineries in Russia and Belarus also impacted by maintenance shutdowns. The latest data from the International Energy Agency shows worldwide refinery throughput declined to around 89 million barrels per day in July, down by 5 million bpd from a year earlier, while global oil demand remains above 100 million bpd.
With their own operations unaffected by attacks or shipping restrictions, refineries in India and the US have increased exports to markets that previously depended heavily on supplies from the Middle East and Russia. According to a Reuters report, analysts and traders said refiners in both countries are likely to continue earning billions of dollars from stronger exports for as long as the conflicts keep traditional supply routes disrupted. US refiners have stepped up overseas sales significantly, with government data showing exports of distillate fuels reached a record 1.9 million barrels per day in the week ended August 7, while jet fuel exports stood at 443,000 bpd. India's monthly clean products exports have benefited from consistently high operating rates at export-oriented refineries such as Reliance and Nayara, with the country expected to continue acting as Asia's swing supplier when regional markets tighten.
According to CNBC TV18 reports, Chennai Petroleum shares rose up to 5.2% to an intraday high of ₹1,454.50 on Tuesday and were trading 2.66% higher at ₹1,419.20 as of 1.04 pm. MRPL shares jumped about 6.7% to the day's high of ₹189 and are currently trading 3.57% up at ₹183.48. The performance shows CPCL has gained 13.8% month-to-date and 40% over the past three months, while the stock is up 54% over the past six months. MRPL has gained 4% month-to-date and 20% over the past three months, although it remains down 7% over the past six months. The strong export performance from both countries is expected to continue, with India benefiting from stable demand from Indonesia, which is expected to consume around 11-12 million barrels in August compared with 9-10 million barrels in July.
On valuations, Chennai Petroleum trades at around 4.9 times FY27 estimated earnings, compared with 9.4 times for MRPL, as reported by CNBC TV18. The significant difference in valuation multiples reflects varying investor sentiment and market expectations for the two companies' future performance amid the current favorable refining margin environment. However, the latest developments show that both Indian and US refiners could face their strongest competition from China, which has traditionally been the dominant fuel exporter to Asian markets, with exports surging to 1.1 million tonnes in July from 240,860 tonnes in June.
