Refining margins have been low because the price of gas is too low compared to oil. Look at the "crack spread". East coast refining margins have dropped more than 60% in the past 6 months.
http://www.oilintel.com/spothome.cfm?loc_id=7
Did you see the Valero announcement earlier in the week? They are looking at a 90% drop in profit this quarter.
March 24 (Bloomberg) -- Valero Energy Corp., the largest U.S. refiner, said it expects first-quarter net income to plunge to as little as 10 cents a share as profit margins on gasoline and other fuels narrow.
Per-share profit will be in the range of 10 cents to 35 cents, San Antonio-based Valero said today in a statement. That would compare with net income of $1.86 a share in 2007's first quarter. Valero was expected to net 96 cents a share in the current quarter, according to the average of two analyst estimates compiled by Bloomberg.