Wednesday, August 26, 2026
Diesel prices near record highs as Ukraine strikes hit more Russian refineries
Diesel just keeps grinding higher — retail's flirting with $5.65 and crack spreads north of $100/bbl — while Washington's biofuel exemption plans threaten to pour gasoline on the fire.
Diesel cracks are blowing out (over $104/bbl) as Ukrainian drone strikes continue to knock Russian refining capacity offline, pushing US retail diesel toward all-time highs near $5.65/gal even as crude softens on Iran de-escalation hopes. Meanwhile, reports that EPA could grant sweeping small-refinery RFS exemptions are drawing fierce pushback from biodiesel and soybean groups warning of lost demand and higher diesel prices, and refiners face an added crude-supply squeeze as Canadian oil sands output falls and Asian buyers scoop up US barrels.
Change vs. prior data point. Spot prices & single-product cracks vs WTI, from EIA data ↗
📈 Markets & Prices
Supply Risks Persist As Markets Navigate Policy Changes And Global Disruptions
ULSD and RBOB chopped back and forth overnight amid ongoing supply-risk headlines and shifting policy signals, per TACenergy's market wrap.
Front Month Nymex RBOB Gasoline Fell 0.55% to Settle at $3.2529 — Data Talk
Front-month RBOB fell 0.55% to $3.2529, its lowest level and largest two-day decline since early August.
NYMEX Overview: Oil Futures Slide on Hopes for De-Escalation — OPIS
Oil futures slid on hopes for de-escalation, though analysts warned disruption risk to crude and refined-product flows persists.
Soaring Diesel Prices Are Helping Oil Companies and Hurting Consumers
Diesel prices have surged due to the Iran conflict and Ukrainian strikes on Russian refineries, boosting oil company profits while squeezing consumers.
Diesel Prices Are About to Break Records. Here’s Why They Keep Rising
National average diesel price sits near $5.62/gal, about 20 cents off the all-time high, with further increases expected.
U.S. Refiners Face New Crude Squeeze as Canada Cuts Oil Sands Output
US refiners face a growing heavy-crude squeeze as Canadian oil sands output falls and Venezuelan supply recovery lags.
🏭 Refining & Supply Ops
Asian Refiners Scoop Up US Crude
Asian refiners are set to nearly double September purchases of US crude, tightening supply for domestic fuel makers amid record US pump prices.
Russia's Afipsky oil refinery on fire after drone attack, two dead, governor sayspaywalled
Russia's Afipsky refinery caught fire after a drone attack that killed two, regional governor said.
Ukraine Says It Hit Major Oil Refinery in Russia’s Volga Regionpaywalled
Ukraine said it struck a major oil refinery in Russia's Volga region, part of a broader campaign against Russian refining capacity.
Ukraine Attacks Oil Refinery, Gas Plant in Russia
Ukraine reported hitting an oil refinery and a gas-processing plant in Russia overnight.
Russia decree widens state control
Putin decreed the state can temporarily seize critical infrastructure if private owners fail to protect it from drone attacks, widening state control amid the refinery strikes.
🏛️ Policy & Credits
Massive refinery exemptions would undo progress under Trump’s 2026-’27 RFS blending levels
Biofuel group IRFA is urging the administration to hold firm on 2026-27 RFS blending levels, warning that large refinery exemptions would undercut the rule's progress.
Reported RFS exemptions for oil companies could devastate recovering biodiesel industry
IBB warns that reported RFS small-refinery exemptions could erase committed biofuel volumes and severely hurt the recovering biodiesel industry.
Soybean group sounds alarm over reports that 2025 SREs could far exceed previous government projections
Soybean growers (ASA) say reported 2025 SREs could far exceed prior projections, potentially costing farmers $1 billion and cutting biofuel demand by hundreds of millions of gallons.
📊 New Investor Materials
BJ's Wholesale Club (BJ)
10-Q (filed 2026-08-25) ↗## Fuel-Segment Extract: BJ's Wholesale Club 10-Q (Q2 FY2026, period ended Aug 1, 2026)
- **Station count:** 206 gas stations across 22 states as of August 1, 2026 (down from BJ's operating alongside 267 clubs; company had 255 clubs a year ago, implying net club growth but gas station count not broken out historically in this filing).
- **Gasoline sales mix rising sharply:** "Gasoline and Other" grew to **25% of net sales in Q2 FY26** (vs. 18% in Q2 FY25) and **23% for the 26-week period** (vs. 18% prior year) — the largest categorical mix shift in the disclosure.
- **Gasoline comparable sales:** **+8.8%** for the thirteen weeks and **+6.9%** for the twenty-six weeks ended Aug 1, 2026, driven by both **higher average retail price-per-gallon** and **increased comparable gallons sold** — no absolute gallon figures disclosed.
- **Margin strategy:** Company states it "generally attempt[s] to maintain a fairly stable gross profit per gallon on an absolute dollar basis," so rising retail pump prices lift net sales dollars but are framed as largely margin-neutral per-gallon; volatile crude/wholesale swings cause temporary "margin contraction or expansion" versus competitors depending on procurement timing.
- **Membership-fuel linkage/rewards economics:** Club+ members get a **5¢/gallon** discount at BJ's Gas; BJ's One/One+ co-branded Mastercard holders get up to a **15¢/gallon** discount when paying at BJ's gas locations — reinforcing fuel as a membership-retention lever tied to card royalty/rewards revenue (recognized via royalty revenue and co-brand deferred revenue balances in Note 3).
- **Cost structure:** "Other segment expenses" (which include gasoline cost of revenue) rose from $911.5M to $1.43B YoY in the quarter and from $1.79B to $2.61B YoY for the half, consistent with higher wholesale fuel costs flowing through cost of sales alongside higher retail pump prices.
**Signal for fuels markets:** BJ's data point to firmer retail pump prices and higher fuel volumes through mid-2026 versus the prior-year period, with the retailer maintaining stable per-gallon dollar margins — indicating resilient consumer fuel demand at warehouse-club price points rather than a margin-driven earnings story.