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Invesaro publishes investment theses and settles them against the market in public: with a date, a basket of companies and a verdict.

Investment thesis

Ukraine is hitting refineries, not wellheads: Russian crude gets cheaper while diesel margins balloon for refiners outside Russia

LivePublished August 2, 2026120-day horizongeopolitics
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In short

  1. What is happening
    Strikes on Russian refineries and beyond. Ukraine hits deep inside the country
  2. Why it matters
    By destroying Russian refineries, Ukraine pushes crude onto the market and takes diesel off it: that drags down the price of crude and blows out margins for refiners outside Russia.
  3. Who benefits
    Valero Energy, Marathon Petroleum, Phillips 66, S-Oil Corporation
  4. What must hold
    Assumptions are statements that must stay true for the thesis to make sense.
    Assumptions: 5. See the assumptions
  5. When is the verdict
    The horizon is the time we give a thesis. That many days after publication we settle it: we compare the basket of companies with the market benchmark and give a verdict.
    November 30, 2026, 120 days after publication
  6. Our score at publication
    A score from 0 to 100 given on the day of publication, before the market has verified anything. On the results page we check in public whether higher-scored theses do better.
    55 out of 100
Basket return
+25.3%
equal weight, since publication
The market over the same window
+1.2%
benchmark for this basket
Edge over the market
+24.1%
in percentage points

Companies in the basket

VLOValero EnergyMPCMarathon PetroleumPSXPhillips 66010950S-Oil Corporation

The argument

For months Ukraine has been shifting the weight of its long-range strikes away from oil fields and terminals and onto the refineries themselves, and today's reports of a strike deep inside Russia confirm that the pattern is escalating. The distinction looks technical, but the market consequences are enormous. Destroying a processing unit does not reduce the amount of crude Russia has in the ground. It reduces its ability to turn that crude into fuel. This is a shock on the product side, not the crude side, and that is why its effects run counter to intuition.

The mechanism splits the market in two. Crude that Russian refineries cannot process either goes to export or forces cuts in production; either way the pressure on the price of crude itself is downward, and the discount on the Urals grade deepens. At the same time, diesel and gasoline disappear from the market. To shield domestic filling stations from shortages, Moscow reaches for a proven tool: a ban on fuel exports. The world thereby loses one of its largest diesel suppliers (Russia has at times been the world's second-largest diesel exporter, on the order of 0.7 million barrels a day).

What this thesis rests on

Each one is a statement that has to be true. We go back to every live thesis on a schedule and check these against public sources, so each leg carries either what we found or the date we look next.

Archive: reviews of this thesis are paused. Last review September 12, 2026.

  1. Ukrainian long-range strikes hit at least one Russian refinery per month, with processing plants rather than oil fields or crude export terminals as the primary target, through 30 November 2026.

    operational · Supported

    A source confirms this · September 12, 2026

    Reported 6 Sep 2026: Ukrainian drones struck the Ryazan oil refinery overnight, starting a fire; Ukraine's General Staff confirmed the refinery was hit. Other targets named in the same operation were an airfield, a radar station and Pantsir-S1 air defence systems in Rostov Oblast, not oil fields or crude export terminals.

    See the source

  2. Russia keeps a ban on diesel or gasoline exports in force for at least 60 days before 30 November 2026, holding back roughly 0.7 million barrels per day of diesel exports.

    regulatory · Supported

    A source confirms this · September 12, 2026

    OPIS factbox published 1 Sep 2026: the Russian government extended its ban on diesel exports through 30 September 2026. The ban was introduced 8 July 2026 (initially to 31 July, then 1 September), so it has run continuously for more than 60 days, all of it before 30 November 2026.

    See the source

  3. Valero reports refining segment operating income per barrel of throughput in Q3 2026 above the level it reported for Q3 2025 in its 10-Q.

    financial · Open

    Checked September 12, 2026, nothing published either way

  4. Marathon Petroleum reports distillates at 30% or more of refined product sales volume in its Q3 and Q4 2026 filings, keeping middle distillate the largest yield after gasoline.

    operational · Open

    Checked September 12, 2026, nothing published either way

  5. S-Oil reports positive refining segment operating profit in both Q3 and Q4 2026 and adds no exploration or production segment during the horizon.

    financial · Open

    Checked September 12, 2026, nothing published either way

Show the causal chain step by step
  1. Ukraine destroys Russian refineries
  2. Russian refinery runs fall
  3. More crude for export, weaker crude price
  4. Less diesel, Russian fuel export ban
  5. Europe sources diesel from far away
  6. Refining margins (cracks) widen
  7. Refiners outside Russia: cheap feedstock, expensive product

This thesis, over time

What has happened since publication. Every entry is computed as of its own date, from price history.

October 1, 2026

Day 60 of 120: basket +25.3%

The thesis is halfway to its verdict. The equal-weight basket stands at +25.3% since publication day. The benchmark (S&P 500) returned +1.2% over the same window, so the basket is ahead of its market by 24.1 percentage points. The strongest contributor is MPC (+32.1%), the weakest is 010950 (+13.2%). 60 days remain until the verdict.

September 12, 2026

Review: 2 of 5 assumptions confirmed

We went back to this thesis on day 41 of 120 and checked each of its 5 assumptions against public sources. Confirmed by the sources: 2. No news either way: 3. The equal-weight basket stands at +22.6% since publication day. The benchmark (.INX) returned +2.2% over the same window, so the basket is ahead of its market by 20.3 percentage points. 79 days remain until the verdict.

September 4, 2026

Basket crossed +20% since publication

This basket is at +21.4% since publication, 33 days after the thesis was posted. The benchmark (S&P 500) returned +3.4% over the same window, so the basket is ahead of its market by 17.9 percentage points. The strongest contributor is 010950 (+24.2%), the weakest is VLO (+18.5%). This is not a change of status: the horizon keeps running and the verdict only lands once it expires.

September 1, 2026

Day 30 of 120: basket +16.8%

The first quarter of the horizon is behind this thesis. The equal-weight basket stands at +16.8% since publication day. The benchmark (S&P 500) returned +2.6% over the same window, so the basket is ahead of its market by 14.1 percentage points. The strongest contributor is MPC (+18.0%), the weakest is VLO (+14.7%). 90 days remain until the verdict.

August 28, 2026

Review: 2 of 5 assumptions confirmed

We went back to this thesis on day 26 of 120 and checked each of its 5 assumptions against public sources. Confirmed by the sources: 2. No news either way: 3. The equal-weight basket stands at +13.7% since publication day. The benchmark (.INX) returned +3.2% over the same window, so the basket is ahead of its market by 10.5 percentage points. 94 days remain until the verdict.

August 13, 2026

Basket crossed +10% since publication

This basket is at +10.0% since publication, 11 days after the thesis was posted. The benchmark (S&P 500) returned +4.1% over the same window, so the basket is ahead of its market by 5.9 percentage points. The strongest contributor is MPC (+11.9%), the weakest is VLO (+8.5%). This is not a change of status: the horizon keeps running and the verdict only lands once it expires.

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This is analysis, not investment advice and not a recommendation to buy or sell anything. We publish it and track it in public, mistakes included. Any decision is yours and yours alone.