Refiners Gain From Energy Rally at Consumers' Expense

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U.S. refiners are the clear winners in the recent market rally, leading the gains in the energy sector.

Refiners have quadrupled the returns of the broader stock market this year. While the S&P 500 index has gained 5 percent in 2013, the S&P Refining Index has skyrocketed over 20 percent. Some U.S. refiners have fared even better. Shares of Valero are up over 30 percent so far this year, while Hess and Marathon have climbed about 25 percent.

(Read More: Oil Bulls Remain in Charge for Now )

Refiners around the country are capitalizing on the incredible growth in unconventional resources such as shale, oil sands and natural gas, which has led to a "refining renaissance," says Oppenheimer energy analyst Fadel Gheit. The U.S. oil and gas production boom has made it far less expensive for refiners to take oil and process it into gasoline, diesel and other refined fuels here than in other parts of the world.

At $96 a barrel, U.S. oil prices are now $20 cheaper than North Sea Brent crude futures, which are trading above $116 a barrel. Since gasoline is priced based on the Brent crude oil market, Gheit says, "making a gallon of gasoline is cheaper to do here than overseas."

(Read More: Consumers Taking Financial Hit From Rising Fuel Prices )

That's the reason East coast refineries, which rely more on foreign oil than domestic crude, are shutting down. Last week, Hess announced the closure of its Port Reading, NJ refinery at the end of the month. Deutsche Bank estimates about 610,000 barrels a day of refining capacity has been shut down since 2009, excluding Hess' NJ refinery. About 60 percent of the closures have been on the East Coast, according to Deutsche Bank.

Meanwhile, BP is spending billions of dollars to expand its Whiting, Indiana facility, already the largest refinery in the Midwest, to better handle growing U.S. and Canadian supplies. But shutdowns and planned repairs to refineries are also reducing gasoline supplies more severely in some parts of the country than others. Overall, the result is higher prices at the pump.

It appears consumers are the biggest losers. Tight gasoline inventories along the East and West coasts causing traders to bid up the price of gasoline futures, contributing to record high retail gas prices for this time of year. High fuel prices are hitting consumers in their wallets just as payroll taxes and income taxes, for some, have also increased.

If gas prices nationally average $3.60 a gallon or higher until the end of the month, it will cost consumers an extra $10 billion in the first quarter, says Moody's Analysts chief economist Mark Zandi. Add that to the additional taxes Americans are paying this year and, Zandi says, that's "almost half a percentage point" of the U.S. GDP. If that happens, it is only a matter of time before high fuel prices start to impede the recovery—and anemic growth—of the overall economy.

(Poll: Will We See Record Gasoline Prices This Year? )

—By CNBC's Sharon Epperson; Follow her on Twitter: @sharon_epperson