Latest news with #MarathonPetroleum
Yahoo
3 days ago
- Business
- Yahoo
Refiners Smell Profits as Heavy Crude Comes Roaring Back--But One Risk Lurks
Refiners may finally be catching a break. After months of margin pressure from tight heavy-light crude spreads, companies like Marathon Petroleum (NYSE:MPC), Valero (NYSE:VLO), and PBF Energy (NYSE:PBF) are positioning for a potential rebound in the second half of the year. On its latest earnings call, Marathon's Chief Commercial Officer Rick Hessling said wider differentials could be on the way, driven by OPEC production increases and Canadian supply coming back online post-maintenance. Gulf Coast refiners, many of which are configured to process heavy crude, stand to benefit if discounted barrels start flowing again. We expect differentials to widen out in the second half this year, Hessling said, pointing to September as a key turning point. Warning! GuruFocus has detected 6 Warning Sign with CASY. Valero's management echoed that optimismwith caution. Chief Operating Officer Gary Simmons flagged that while recent events like Venezuelan sanctions and Canadian wildfires have tightened supply, the worst may be behind. Going forward, we do think things will get better, Simmons noted, although he expects the margin boost to be more visible by Q4. PBF Energy's CEO Matthew Lucey added that the second quarter was tough, calling narrow crude spreads a significant challenge, but projected 2 million to 2.5 million barrels per day of heavy output could return by fall, just in time for seasonal refinery maintenance. Meanwhile, Californiaof all placesmight quietly become a swing factor. Recent regulatory shifts under Governor Gavin Newsom could revive in-state drilling, just as Phillips 66 and Valero prepare to shut down major refineries on the West Coast. With less refining capacity and more California crude staying local, Marathon sees those barrels as "advantaged." But one variable could complicate this recovery: potential sanctions on Russian crude under a future Trump administration. The only unknown here is really what happens with the Russian sanctions, Valero's Simmons warned. If sanctions tighten, that could cut off Russian barrels and push heavy crude prices back up, limiting gains for U.S. refiners. This article first appeared on GuruFocus.
Yahoo
3 days ago
- Business
- Yahoo
Refiners Smell Profits as Heavy Crude Comes Roaring Back--But One Risk Lurks
Refiners may finally be catching a break. After months of margin pressure from tight heavy-light crude spreads, companies like Marathon Petroleum (NYSE:MPC), Valero (NYSE:VLO), and PBF Energy (NYSE:PBF) are positioning for a potential rebound in the second half of the year. On its latest earnings call, Marathon's Chief Commercial Officer Rick Hessling said wider differentials could be on the way, driven by OPEC production increases and Canadian supply coming back online post-maintenance. Gulf Coast refiners, many of which are configured to process heavy crude, stand to benefit if discounted barrels start flowing again. We expect differentials to widen out in the second half this year, Hessling said, pointing to September as a key turning point. Warning! GuruFocus has detected 6 Warning Sign with CASY. Valero's management echoed that optimismwith caution. Chief Operating Officer Gary Simmons flagged that while recent events like Venezuelan sanctions and Canadian wildfires have tightened supply, the worst may be behind. Going forward, we do think things will get better, Simmons noted, although he expects the margin boost to be more visible by Q4. PBF Energy's CEO Matthew Lucey added that the second quarter was tough, calling narrow crude spreads a significant challenge, but projected 2 million to 2.5 million barrels per day of heavy output could return by fall, just in time for seasonal refinery maintenance. Meanwhile, Californiaof all placesmight quietly become a swing factor. Recent regulatory shifts under Governor Gavin Newsom could revive in-state drilling, just as Phillips 66 and Valero prepare to shut down major refineries on the West Coast. With less refining capacity and more California crude staying local, Marathon sees those barrels as "advantaged." But one variable could complicate this recovery: potential sanctions on Russian crude under a future Trump administration. The only unknown here is really what happens with the Russian sanctions, Valero's Simmons warned. If sanctions tighten, that could cut off Russian barrels and push heavy crude prices back up, limiting gains for U.S. refiners. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
3 days ago
- Business
- Reuters
United Steelworkers union sets proposals for next refinery worker contract
HOUSTON, Aug 7 (Reuters) - More than 300 United Steelworkers union (USW) refinery and chemical plants workers meeting in Pittsburgh approved on Thursday proposals for labor negotiations set to begin early in 2026 with energy companies, said Mike Smith, chair of national oil bargaining for the union. The current four-year contract covering 30,000 workers expires shortly after 12 a.m. on Feb. 1, 2026. The USW members work at refineries that account for over half of national crude oil processing capacity. USW negotiators led by Smith and including International President David McCall and International Vice President Roxanne Brown will begin meeting in January with negotiators from Marathon Petroleum (MPC.N), opens new tab, which will be representing the industry. "As the lead company in national pattern negotiations, MPC looks forward to productive negotiations with the USW and is committed to working toward a mutually satisfactory agreement,' said Marathon spokesperson Jamal Kheiry. A key issue will be wage increases for refinery and chemical plant workers, who average more than $50 an hour for inside operators. 'I would say the proposals on wages are significant for the times in which we are living,' Smith said. He declined to be more specific about the union's wage proposals. Another top issue is the cost of health care, Smith said. 'We're trying to secure good decent health care without bearing the brunt of rising costs,' he said. And as with many industries, the union has a proposal on artificial intelligence. 'The AI proposal is really to protect us as we try to understand the impacts on our sector,' Smith said. A supermajority of local unions must approve the proposals agreed to in Pittsburgh within 45 days so they can be brought to the bargaining table. Smith said he could not now predict how difficult or easy the negotiations might be with Marathon. "It is early,' he said. 'No bargaining session is easy or simple. Our members are ready to do what it takes to secure a good contract for our membership.' At negotiations in 2022, the USW secured a 2.5% wage increase in the first year, 3% in both the second and third years and 3.5% in the fourth year.
Yahoo
3 days ago
- Business
- Yahoo
United Steelworkers union sets proposals for next refinery worker contract
By Erwin Seba HOUSTON (Reuters) -More than 300 United Steelworkers union (USW) refinery and chemical plants workers meeting in Pittsburgh approved on Thursday proposals for labor negotiations set to begin early in 2026 with energy companies, said Mike Smith, chair of national oil bargaining for the union. The current four-year contract covering 30,000 workers expires shortly after 12 a.m. on Feb. 1, 2026. The USW members work at refineries that account for over half of national crude oil processing capacity. USW negotiators led by Smith and including International President David McCall and International Vice President Roxanne Brown will begin meeting in January with negotiators from Marathon Petroleum, which will be representing the industry. "As the lead company in national pattern negotiations, MPC looks forward to productive negotiations with the USW and is committed to working toward a mutually satisfactory agreement,' said Marathon spokesperson Jamal Kheiry. A key issue will be wage increases for refinery and chemical plant workers, who average more than $50 an hour for inside operators. 'I would say the proposals on wages are significant for the times in which we are living,' Smith said. He declined to be more specific about the union's wage proposals. Another top issue is the cost of health care, Smith said. 'We're trying to secure good decent health care without bearing the brunt of rising costs,' he said. And as with many industries, the union has a proposal on artificial intelligence. 'The AI proposal is really to protect us as we try to understand the impacts on our sector,' Smith said. A supermajority of local unions must approve the proposals agreed to in Pittsburgh within 45 days so they can be brought to the bargaining table. Smith said he could not now predict how difficult or easy the negotiations might be with Marathon. "It is early,' he said. 'No bargaining session is easy or simple. Our members are ready to do what it takes to secure a good contract for our membership.' At negotiations in 2022, the USW secured a 2.5% wage increase in the first year, 3% in both the second and third years and 3.5% in the fourth year. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
6 days ago
- Business
- Reuters
Top US refiner Marathon Petroleum beats quarterly profit on higher refining margins
Aug 5 (Reuters) - Marathon Petroleum Corp (MPC.N), opens new tab beat Wall Street estimates for second-quarter profit on Tuesday, benefiting from a rebound in refining margins as fuel demand remained firm. U.S. refiners are posting upbeat quarterly profits, recovering from the losses in the previous quarter on stronger diesel margins. Marathon's rivals Valero Energy (VLO.N), opens new tab, Phillips 66 (PSX.N), opens new tab and HF Sinclair (DINO.N), opens new tab all exceeded Wall Street estimates. Diesel cracks - a measure of margins - averaged $17 per barrel during the quarter, in line with the first quarter. However, they ended the three-month period higher at $21 per barrel, TPH & Co analyst Matthew Blair said in a note earlier. Fuel makers also saw an unexpected boost in profits from higher demand for key products in recent months, easing the slump since 2022 highs, driven by a post-pandemic recovery and war-related supply disruptions. The margins also benefited from improved capture rates, which reflect a refining company's ability to capitalize on favorable market conditions. "Our second-quarter results reflect actions we have taken to deliver on our strategic refining, our team delivered 97% utilization and 105% margin capture; and we remain constructive on the long-term outlook," said CEO Maryann Mannen. Marathon's throughput volumes for the quarter were 3.1 million barrels per day (mmbpd), unchanged from last year, but now expects 2.9 mmbpd in the third quarter. Its refining and marketing margin per barrel rose to $17.58 in the quarter from $17.53 a year earlier. The company reported adjusted profit of $3.96 per share for the three months ended June 30, compared with analysts' average estimate of $3.29 per share, according to data compiled by LSEG.
