Goldman Sees Tight Oil Refining Market: ETF Areas Likely to Gain

Goldman Sachs expects diesel and jet-fuel crack spreads to stay elevated through 2027, averaging above $40 per barrel, more than double historical levels. That call puts refining margins at the center of the energy trade and points to CRAK as a direct beneficiary.

Goldman ties the outlook to refining capacity constraints and a potential recovery in fuel demand. Refined-product inventories are projected to fall to their lowest levels since 2015, which would force refiners to run at high utilization rates to keep up.

The bank also expects crude prices to decline. That split matters: lower crude input costs against $40-plus product spreads widens the margin refiners capture. Interpretation: the call favors processing and midstream exposure over pure crude price exposure.

Per the outlook, the supported groups are refiners and pipeline operators. That maps to CRAK for refining, AMLP for pipeline operators, and XLE and XOP for broader energy exposure. XOP's tilt toward exploration and production makes it the most exposed to the projected crude decline, while CRAK and AMLP align more closely with Goldman's thesis.