AGL 40.18 Increased By ▲ 0.18 (0.45%)
AIRLINK 127.48 Increased By ▲ 0.44 (0.35%)
BOP 6.63 Decreased By ▼ -0.04 (-0.6%)
CNERGY 4.51 No Change ▼ 0.00 (0%)
DCL 8.60 Increased By ▲ 0.05 (0.58%)
DFML 41.95 Increased By ▲ 0.51 (1.23%)
DGKC 87.70 Increased By ▲ 0.85 (0.98%)
FCCL 32.70 Increased By ▲ 0.42 (1.3%)
FFBL 65.18 Increased By ▲ 0.38 (0.59%)
FFL 10.32 Increased By ▲ 0.07 (0.68%)
HUBC 109.49 Decreased By ▼ -0.08 (-0.07%)
HUMNL 14.65 Decreased By ▼ -0.03 (-0.2%)
KEL 5.13 Increased By ▲ 0.08 (1.58%)
KOSM 7.53 Increased By ▲ 0.07 (0.94%)
MLCF 41.78 Increased By ▲ 0.40 (0.97%)
NBP 59.75 Decreased By ▼ -0.66 (-1.09%)
OGDC 193.95 Increased By ▲ 3.85 (2.03%)
PAEL 28.20 Increased By ▲ 0.37 (1.33%)
PIBTL 7.83 No Change ▼ 0.00 (0%)
PPL 151.80 Increased By ▲ 1.74 (1.16%)
PRL 26.60 Decreased By ▼ -0.28 (-1.04%)
PTC 16.10 Increased By ▲ 0.03 (0.19%)
SEARL 84.99 Decreased By ▼ -1.01 (-1.17%)
TELE 7.70 Decreased By ▼ -0.01 (-0.13%)
TOMCL 35.45 Increased By ▲ 0.04 (0.11%)
TPLP 8.15 Increased By ▲ 0.03 (0.37%)
TREET 16.10 Decreased By ▼ -0.31 (-1.89%)
TRG 52.73 Decreased By ▼ -0.56 (-1.05%)
UNITY 26.40 Increased By ▲ 0.24 (0.92%)
WTL 1.26 No Change ▼ 0.00 (0%)
BR100 9,957 Increased By 73.1 (0.74%)
BR30 30,925 Increased By 325.2 (1.06%)
KSE100 93,862 Increased By 506.4 (0.54%)
KSE30 29,087 Increased By 156.3 (0.54%)
Markets

PBF sees slow refining rebound as US gasoline demand creeps higher

The gasoline crack spread, which drifted negative in March as the coronavirus pandemic sharply cut air and road tra
Published May 15, 2020
  • The gasoline crack spread, which drifted negative in March as the coronavirus pandemic sharply cut air and road travel.
  • We are just not going to do what everybody expects refiners to do, see an improvement in gasoline cracks and say, 'The Holy Grail, there it is, let's ramp up, let's run
  • PBF's shares were up nearly 4% at $9.62 on Friday. They are off nearly 70% year to date.

PBF Energy, the fourth-largest US oil refiner by capacity, is holding processing near 70% of throughput even as more states relax stay-at-home orders, boosting demand for motor fuel, executives said on Friday.

The gasoline crack spread, which drifted negative in March as the coronavirus pandemic sharply cut air and road travel, has recovered to $11.42 per barrel this week. However, fuel demand is off 23% in the United States over the last four weeks.

"We are just not going to do what everybody expects refiners to do, see an improvement in gasoline cracks and say, 'The Holy Grail, there it is, let's ramp up, let's run,'" Chief Executive Thomas Nimbley said on an earnings call on Friday. "This thing is not over."

PBF's shares were up nearly 4% at $9.62 on Friday. They are off nearly 70% year to date.

At the start of the year, PBF planned to run about 950,000 barrels of oil per day (bpd). But it now expects to run in the 650,000 to 750,000 bpd range, executives said on the call.

Demand for gasoline has inched up and gasoline production has climbed for a third straight week to 7.5 million bpd, according to the latest data from the Energy Information Administration.

"We're not planning to get back to where things were prior to the pandemic, but I do believe at this point, we are starting to see green shoots related to a recovery," Nimbley told investors.

PBF Energy joined rivals such as Marathon Petroleum in shifting production to gasoline after initially maximizing diesel output during the early surge of coronavirus cases.

With COVID-19 cases rising in South America, exports are being reduced, Nimbley said.

PBF reported a quarterly loss in the first quarter on a $1.28 billion inventory writedown amid the sharp decline in fuel demand.

The company posted an adjusted loss of $1.19 per share, wider than analysts' average estimate of a $1.04 per share loss, according to IBES data from Refinitiv.

The loss reflected refinery operating expenses that were higher than analysts expected and weaker margins from a turnaround at its Toledo, Ohio, plant, financial services firm Tudor Pickering, Holt & Co wrote in a note on Friday.

PBF said it cut its 2020 planned capital expenditures further by a total of more than $350 million, from its previous estimates of $240 million.

 

Comments

Comments are closed.