Global refining capacity is under severe stress from the Iran-Ukraine conflict, with Middle East refineries under attack, Russian capacity crippled by drone strikes (40% offline), and China cutting exports. Only US Gulf Coast refineries can meet demand, running at full capacity—creating windfall profits for US oil majors like Exxon ($160M/day in Q3) and elevated diesel crack spreads ($102/barrel). This supply squeeze is manageable but leaves no margin for error as markets enter peak seasonal demand.