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By Sheila Dang and Sharma
Houston-Big Oil executives this week saw small perspectives of a short-term improvement in the refinery profits after Chevron, Exxon Mobil and Shell, all reported profits in the fourth quarter that were beaten a lot by a recession on the margins To produce fuel.
An increase in global refining capacity in 2024, combined with the growth in spray demand, has harmed refining margins.
Chevron’s shares decreased by 4% after he reported a loss in his refining business for the first time since 2020, which caused the US oil producer No. 2 to stipulate the profits of Miss Wall Street.
“This trend we have seen about the margins that soften until 2024 is something that can expect to continue seeing, to extend to 2025,” said Chevron CEO, Mike Wirth, in an interview.
“It was a fourth weak trimester, there is no doubt about it,” he said at a telephone conference after the profits in response to an analyst on the recession of refining.
“I’m not going to call him a perfect storm, but it was a quarter in which everything came out in a sense and it was negative.”
Wirth said Chevron would focus on what he can control to recover, including lighter programmed maintenance for refineries during the next year.
Exxon Mobil’s shares fell 2.5% after it reported a 75% drop in tight refining profits compared to the third quarter. The widest index of the S&P 500 energy sector dropped 2.8% on Friday.
The refining business remains under the pressure of the additional fuel supply that enters the market after new refineries were opened in different countries around the world, said Exxon’s financial director Kathryn Mikells, in an interview.
“That is really what we are seeing while looking at 2025,” he said.
The American oil producer number 1 still exceeded earnings estimates with a greater production of the Permica basin, the best oil field in the United States and Guyana, the last oil access point.
Shell, based in the United Kingdom, said Thursday that although he had no plans to leave the refining business, he did not plan to expand.
The profits of the fourth quarter of the company were almost reduced by half from the year before $ 3.66 billion, partly due to the weakest refining margins.
Shell sold its refining and chemical products in Singapore last year and plans to close another plant in Wesseling, Germany.
Hit independent refiners
While greater oil and gas production helped cushion oil specialties for the impact of lower refining profits, pure play refiners received a blow when the fuel demand hesitated in the United States and China, the two consumers of larger oil.
The fourth quarter of Phillips 66 collapsed to $ 8 million of $ 1.26 billion in the trimester of the previous year. Valero’s refining gain fell 73% in the fourth quarter.
