Oil Refineries: How They Work and Their Key Functions

Oil refineries turn crude oil into gasoline, diesel, and kerosene through distillation, a core function of the downstream sector. The industry uses crack spreads to gauge refining margins and the Nelson Complexity Index to rate a refinery’s ability to produce lighter, more valuable products. Refineries operate around the clock, sometimes spanning hundreds of football fields, and output depends on crude type and demand. U.S. refineries, per the EIA, produce about 19–20 gallons of motor gasoline, 11–12 gallons of distillate (mainly diesel), and roughly four gallons of jet fuel per 42‑gallon barrel, with many other products also created. Major players include Koch Pipeline Company and others in the global network.