2Q26 Post Mortem and Model Update

Research evidence excerpt

2Q26 Post Mortem and Model Update

rough RBI. PBF's RBI program generated in excess of

$230 MM of run-rate cost improvements in 2025, and is expected to grow to more than

$350 MM by year-end 2026. Management highlighted a circuit-wide energy efficiency

program that cut purchased natural gas 20% on a per-barrel, price-adjusted basis versus

the 2024 baseline, along with a marked improvement in turnaround execution. The new

strategic procurement organization is halfway through renegotiating over 60 contracts,

with expected savings of ~$60 MM a year in goods and services. Management noted it

addressed its cost structure first, and as efficiencies are achieved, new margin

opportunities are opening up.

• SBR, Renewable Diesel, and RINs. SBR produced ~15.1 Mb/d of renewable diesel in

2Q, reflecting reduced rates from an April catalyst change. RD production for 3Q is

expected to average ~18-20 Mb/d. Management is encouraged by improved catalyst

performance and is seeing robust RD margins driven by high distillate margins and

elevated RINs pricing. The effective RIN basket price was $13.78/bbl in 2Q vs $8.76/bbl

in 1Q. Management noted a recent RINs correction, with prices down 10% to 15% in the

prior two weeks on the perception that small refinery exemptions could enter the market.

Management continued to describe the RFS program as imposing ~$14 per bbl of costs,

largely borne by the consumer.

• Martinez Update. Martinez returned to full operations in May 2026, again supplying

California with a full slate of domestically produced products. During the restoration, the

hydrocracker did the heavy lifting in keeping the refinery operating and fulfilling

customer commitments. In 2Q, insurers paid a fifth unallocated installment of $250 MM,