Oil and gas refinery stocks are experiencing a notable uptick as tensions between the United States and Iran escalate, potentially affecting shipping routes in the crucial Strait of Hormuz. The growing military activity in this key oil-producing region is driving oil prices higher, with Brent crude futures recently surpassing the $70-per-barrel mark. This surge has prompted significant interest in refinery stocks, which are expected to benefit from any disruption in supply.
Haris Khurshid, chief investment officer at Karobaar Capital LP, emphasized the market’s sensitivity to supply disruptions, stating, “Markets can tolerate headlines but won’t ignore lost supply.” A confirmed disruption in Iranian exports could lead to a rapid repricing of crude oil, creating substantial implications for refinery operations globally.
Concerns are mounting that disruptions could arise not just from Iran, which contributes approximately 3% of global oil production, but also from neighboring countries like Saudi Arabia, Iraq, and Kuwait. Analysts at Goldman Sachs have responded by raising their fourth-quarter forecasts for both Brent and West Texas Intermediate (WTI) crude by $6 each, predicting prices of $60 and $56 per barrel, respectively.
### Market Dynamics and Supply Outlook
The oil market’s fundamentals appear to contradict the prevailing narrative of a surplus. According to Barclays, a potential 1 million barrels per day disruption in supply—equivalent to half of Iran’s crude exports—could elevate the fair value of oil by $8.
Additionally, production cuts from Russian oil producers, which have reached their lowest drilling levels in three years, are further tightening the market. Sergey Vakulenko noted that the output trends in Russia closely mirror those of U.S. shale production, with declines reflecting prior drilling activity.
### Identifying Promising Stocks
In light of these developments, several oil and gas refinery stocks are emerging as potential investment opportunities. Using data from the VanEck Oil Refiners ETF (CRAK) and the Yahoo screener, we identified companies in the sector listed on the NASDAQ and NYSE. The following stocks have been selected based on their analyst ratings and upside potential as of February 20, 2026.
1. **Delek US Holdings Inc (NYSE:DK)**
– **Stock Upside Potential:** 20.63%
– **Number of Hedge Fund Holders:** 33
– Delek recently announced a quarterly dividend of $0.255 per share, with positive Q3 earnings that exceeded expectations.
2. **CVR Energy, Inc. (NYSE:CVI)**
– **Stock Upside Potential:** 17.61%
– **Number of Hedge Fund Holders:** 32
– Despite reporting a loss per share of $0.80, CVR’s revenue surpassed expectations, and the company remains optimistic about refining prospects.
3. **Par Pacific Holdings Inc (NYSE:PARR)**
– **Stock Upside Potential:** 23.66%
– **Number of Hedge Fund Holders:** 39
– Anticipating its Q4 results, Par Pacific is adjusting to shifting crude market dynamics.
4. **BP PLC (NYSE:BP)**
– **Stock Upside Potential:** 2.36%
– **Number of Hedge Fund Holders:** 50
– BP reported an underlying profit of $1.5 billion but faced significant impairments, prompting adjustments in its capital expenditure plans.
5. **HF Sinclair Corp (NYSE:DINO)**
– **Stock Upside Potential:** 11.01%
– **Number of Hedge Fund Holders:** 53
– Strong earnings and dividend returns indicate a robust operational performance, although some challenges persist.
6. **Phillips 66 (NYSE:PSX)**
– **Stock Upside Potential:** 0.10%
– **Number of Hedge Fund Holders:** 60
– The company is seeking to enhance profitability through direct crude purchases from Venezuela, reflecting strategic shifts in sourcing.
7. **Marathon Petroleum Corporation (NYSE:MPC)**
– **Stock Upside Potential:** 3.06%
– **Number of Hedge Fund Holders:** 63
– BMO Capital raised its price target following strong performance indicators, indicating confidence in future growth.
8. **Valero Energy Corp (NYSE:VLO)**
– **Stock Upside Potential:** 0.72%
– **Number of Hedge Fund Holders:** 64
– Valero is set to import significant volumes of Venezuelan crude, further diversifying its supply chain.
As geopolitical tensions continue to influence market dynamics, these stocks may present valuable opportunities for investors. The ongoing situation in the Middle East and developments in global oil production will likely shape the landscape for oil and gas refinery stocks in the coming months.
