Americas Oil: Gasoline is stickier than oil...what previous boom cycles tell us about the velocity of crude & products

The report reviews three prior episodes in which oil prices peaked and then declined: the global financial crisis, the "war on shale," and the Russia/Ukraine war. It finds that refined product prices fall more slowly than crude prices, making refiners and integrated oil companies relatively defensive. Across the three cycles, Brent changed -44%, -46%, and +14% after peaking, while crack spreads changed -3%, +22%, and +80%. Cracks as a percentage of crude rose after oil prices declined and remained elevated for at least 200 calendar days, and for nearly 500 days after the Russia/Ukraine war. If history repeats, refiners and integrateds should be more protected as oil prices normalize, with XOM rated Outperform and CVX Market-Perform. However, escalation in the Strait of Hormuz or Russia/Ukraine could push oil prices higher first, so the report continues to recommend integrated exposure through XOM and lower-beta E&P exposure through COP, FANG, and DVN.