Widen your energy stock horizon if refining margins roll over, Todd Gordon advises

* Author revised bullish oil refiner stance after market signals * Refiners outperformed (108.7%) on wide crack spreads; now overextended * Suggests adding COP; watch crack spread divergence for reversal risk Research shifted from bullish oil-refiner outlook to caution after examining market data. The 2-year vs. fed-funds spread (64 bp) exceeds the 2015 tightening threshold, and futures price a September hike at 68%. Despite $90+ oil, expected inflation (orange line) is declining, suggesting limited inflationary pressure. Energy sub-sectors diverged: refining/marketing (MPC, VLO, PSX) returned 108.7% on wide crack spreads, while E&P lagged. CRAK ETF shows a higher-high vs. rolling-over 3-2-1 crack, hinting at a pullback. COP is breaking above $135 with rising earnings estimates. Author plans to add COP but will trim refiners if the crack spread reverses lower.