UBS Sees Phillips 66 (PSX) Blazing Past its Record High

Phillips 66 (NYSE:PSX) has nearly doubled in value since the start of 2026, buoyed by high refining margins stemming from the US-Iran conflict, which has sharply cut global refining capacity and squeezed supplies of gasoline, diesel, and jet fuel. While PSX is trading near its all-time high, some investors are wondering if the rally may be nearing an end.

However, UBS sees the stock's upside potential still far from exhausted. On September 8, the firm raised its price target from $235 to $300, and kept a Buy rating on the shares, implying an upside of over 15% from current levels and even surpassing the record high of over $263 seen earlier this month. UBS believes Phillips 66 is well-positioned for sustained value creation, thanks to elevated margins in refining, chemicals, and renewable diesel that could persist longer than anticipated.

The company's strong position is further fortified by the global refining market's resilience, particularly after the escalation of tensions between the US and Iran. Even if Middle Eastern crude supplies rebound, damaged refineries will require significant time to reach full capacity, keeping refined-fuel markets constrained. Phillips 66 is also bullish, with Executive Vice President of Marketing and Commercial Brian Mandell noting that the Middle East and Asia are short 7 million barrels per day, and Russia is short 1.4 million bpd of refined products, providing additional support to margins.