US oil refiners reap windfall from Iran war

{"text":[[{"start":7.65,"text":"US oil refiners have emerged as one of the few winners from the Iran war by reaping large profits from high diesel and jet fuel prices, boosted by their access to cheap North American supplies of crude. "}],[{"start":18.75,"text":"The Iran war has created one of the largest oil supply disruptions in history, slashing production across the Gulf and curbing refining operations in the Middle East and beyond."}],[{"start":30.05,"text":"The shortfalls have throttled supply to refiners in Asia, sending fuel prices soaring, but many refiners in Europe have struggled to capitalise due to the soaring cost of crude oil offsetting their gains from rising sales."}],[{"start":43.65,"text":"US refiners, by contrast, are reaping the rewards, with cheap feedstock and soaring fuel prices a potent combination given their access to cheaper crude domestically alongside supplies imported from Canada and Mexico."}],[{"start":58.599999999999994,"text":"“The US refiners have had an advantage of cheaper domestic crude for some time, they have made it their strategy to increase access to that crude for more than a decade,” said Robert Campbell, head of product development at consultancy Energy Aspects."}],[{"start":73.44999999999999,"text":"“What we’re seeing here is that advantage writ large.”"}],[{"start":76.69999999999999,"text":"Campbell added that US refiners were operating close to full capacity to capture the windfall. US plants have been increasing exports of diesel and jet fuel to Europe and Asia, with some cargoes being sent as far away as Australia."}],[{"start":90.74999999999999,"text":"The cost margins of US refiners have increased to between $20 and $25 a barrel, according to consultancy Rystad, almost double their normal level from early in March."}],[{"start":101.09999999999998,"text":"The boost to US refining companies comes as the Trump administration has hailed what it calls “US Energy Dominance”, thanks to a shale boom that has transformed the country into a large exporter of refined fuels."}],[{"start":115.19999999999997,"text":"US motorists have still been stung, however, by sharp increases in prices at the pump that could affect US midterm elections in November."}],[{"start":122.99999999999997,"text":"Shares in ExxonMobil and Chevron, which operate large US-based refining operations alongside their production arms, are up 21 per cent and 18 per cent respectively since the start of the year."}],[{"start":135.29999999999998,"text":"Shares of US-focused refiners such as Valero Energy, HF Sinclair, Marathon Petroleum and Phillips 66 are up even more, rising 27 per cent on average over the same time period."}],[{"start":null,"text":"

"}],[{"start":147.74999999999997,"text":"Andy Walz, Chevron’s president for downstream, midstream and chemicals, said the US was also benefiting from rising crude oil imports from Venezuela, where the Trump administration seized President Nicolás Maduro in January. "}],[{"start":160.54999999999998,"text":"Chevron is the largest private-sector operator in Venezuela and has increased its stake in a number of projects after the overthrow of Maduro. "}],[{"start":168.74999999999997,"text":"Walz said Chevron was focused on “supplying as much gasoline, diesel and jet fuel as we can”."}],[{"start":175.14999999999998,"text":"“If there’s anything to be learned from 2026, it’s that the world needs more energy,” said Walz, adding that “more supply from Venezuela helps US consumers and is helping Venezuelans, too.”"}],[{"start":187.84999999999997,"text":"Crude imports from Venezuela have tripled over the past year to 412,000 barrels a day, according to the US Energy Information Administration, to now represent about 3.5 per cent of US imports, helping boost supplies. "}],[{"start":201.89999999999998,"text":"Susan Bell, senior vice-president of downstream at Rystad, said refiners were likely to be now reaping a windfall as crude prices in North America had not risen nearly as much as the price of physical crude oil cargoes in Asia, which were much more reliant on exports from the Gulf."}],[{"start":219.09999999999997,"text":"“The US refiners have the benefit that their physical crude oil prices have not blown out like the physical prices have in the Pacific Basin,” said Bell."}],[{"start":227.54999999999995,"text":"US refiners have not been entirely immune, however, to some of the wild swings in energy markets the conflict in Iran has triggered."}],[{"start":235.84999999999997,"text":"Last week, Exxon and Chevron warned they suffered billions of mark-to-market derivatives losses after crude oil prices shot up in March. That forced the companies to post a paper loss on the hedges linked to cargoes that have not yet been delivered. Phillips 66 reported a similar $900mn loss."}],[{"start":255.29999999999995,"text":"But the companies have indicated those paper losses should largely be reversed as fuel sales are eventually realised at higher prices."}],[{"start":263.4,"text":"Exxon said the negative impact on its first-quarter earnings was a “timing effect” that would unwind over subsequent quarters."}],[{"start":271.2,"text":"Campbell at Energy Aspects said that while US refiners were enjoying the short term, they may still face increased competition in the coming weeks as Asian buyers start to compete more aggressively for US oil cargoes if the Strait of Hormuz remains closed."}],[{"start":285.9,"text":"“It will be interesting to see if there’s any tightness in US crude,” in the coming months, Campbell said."}],[{"start":299.2,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1776740699_8460.mp3"}