In energy-intensive crude oil distillation systems, with their distillation units and heat recovery systems, preflash units can create opportunities to reduce demand for fired heating and increase heat recovery. As holistic, systematic design methodologies are not available for design of crude oil distillation systems with preflash units, this work proposes a simulation-based design approach, where the objective is to minimize fired heat demand of the system. The approach exploits interactions between the separation and heat recovery systems, considering product quality and yield. Rigorous distillation models in Aspen HYSYS, pinch analysis and randomized optimization (a genetic algorithm) are employed, via a MatLab interface, to minimize hot utility demand by selecting optimizing operating variables and one structural variable, namely, the feed location of the preflash vapor. A case study demonstrates the approach, showing that a preflash unit can reduce hot utility demand but that system is vulnerable to yield losses.