Marathon Petroleum And Phillips 66 Cruise Past Estimates On Fuel Demand Surge
11.07.2022 By - NEWS

November 7, 2022 [OAN] – Marathon Petroleum and Phillips 66 posted quarterly profits which cruised past Wall Street estimates on Tuesday, becoming the latest U.S. refiners to benefit from robust fuel demand and margins amid tight supplies.


U.S. refiners are posting strong profits with refineries running at record levels this year, strong export demand amid a squeezed supply due to Russia’s invasion of Ukraine and plant closings.

The sector has, however, drawn criticism from President Joe Biden, who said refiners were putting profits ahead of consumers and urged them to expand capacity.

Shares of Marathon rose as much as 4% to their all-time high of $118.09, while Phillips 66 jumped 5% to $109.66.

Top bosses of both refiners said market environment continues to be favorable and product demand remains strong.

“As supply remains constrained and demand continues to rebound, we maintain a bullish outlook towards the refining environment as we look into 2023,” said Michael Hennigan, Marathon’s chief executive officer, on a call.

Marathon, the largest U.S. refiner by capacity, said quarterly crude capacity utilization was about 98%, resulting in total throughput of 3 million barrels per day (bpd), 7% higher than a year earlier.

For the current quarter, it expects refinery throughput to be 2.9 million bpd.

Amid the bumper results, Marathon also increased its dividend by 30% to 75 cents per share and expects to commence share buy backs in November using the remaining $5 billion repurchase authorization.

“Marathon’s strong financial position and sizable share repurchase program should provide downside protection if oil demand falls…see an opportunity for increasing cash returns,” said Faisal Hersi, an analyst at Edward Jones.

Marathon’s refining and marketing margin doubled to $30.21 per barrel for the reported quarter compared with a year earlier.

Mirroring similar gains, rival Phillips 66’s realized refining margins tripled in the July-September quarter to $26.58 per barrel.

“(PSX) quarterly results were solid, in our view, as all four segments exceeded expectations, but the refining segment led the way,” Hersi added.

Phillips said it returned $1.2 billion through share repurchases and dividends during the quarter.

On an adjusted basis, Marathon reported a profit of $7.81 per share, beating average analysts’ estimate of $7.07, while Phillips 66’s adjusted profit of $6.46 per share smashed estimates of $5.04, according to Refinitiv data.

Pro Trial: Access 10,390 Tank Terminal and Production Facilities

Book a demo to see how to offer, bid and book tank capacity globally. Quick and easy.

Tangier Island Awarded $2.3 Million Grant for Fuel Storage
06.20.2024 - NEWS
June 20, 2024 [National Fisherman]- Tangier Island, Va., sits in the middle of Chesapeake Bay wit... Read More
Sweco Supports VoltH2 in Design and Development of New Green Hydrogen Plant in The Netherlands
06.20.2024 - NEWS
June 20, 2024 [Public Now]- The European energy company VoltH2 has selected Sweco as its partner ... Read More
ONEOK Completes Acquisition of Gulf Coast NGL System
06.20.2024 - NEWS
June 20, 2024 [ONEOK]- ONEOK, Inc. announced that it has completed its acquisition of a system of... Read More
Phillips 66 Refining Margins Tighten on TMX Expansion Start-Up
06.20.2024 - NEWS
June 20, 2024 [Market Screener]- U.S. refiner Phillips 66 said on Tuesday its margins have tighte... Read More