HF Sinclair, PBF profits decline as support from elevated fuel prices wanes

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Refiners last year posted bumper profits, benefiting from strong pricing after Russia’s invasion of Ukraine strained fuel supplies that were already running low due to reopening economies across the world after a long pandemic-led shutdown.

Dallas, Texas-based HF said consolidated refinery gross margin stood at $22.22 per produced barrel, a 39% fall from a year earlier, while PBF’s gross refining margin, excluding special items, slumped 55% to $13.62 a barrel.

Refiners are running their plants at high capacity to meet resilient demand even as fuel prices stabilize.

PBF’s profit dropped 15.2% to $1.02 billion, while that of HF plunged 58.4% to $507.7 million.

However, both refiners managed to beat profit estimates, according to Refinitiv, just as bigger rivals Valero Energy Corp (NYSE:VLO), Marathon Petroleum (NYSE:MPC) and Phillips 66 (NYSE:PSX) that reported steep declines in quarterly profits but beat market expectations.

“Looking ahead, the balance between global refining capacity and refined product demand remains tight,” PBF CEO Matt Lucey said in a statement.

Parsippany, New Jersey-based PBF said quarterly throughput remained unchaged at about 935,800 barrels per day (bpd) from a year earlier.

It expects current-quarter throughput between 925,000 and 985,000 bpd.

HF said second-quarter refinery utilization stood at 81.7%, resulting in a throughput of 598,970 bpd, lower than 663,310 bpd a year earlier.

The company said its throughput decreased due to turnarounds at its Navajo, Parco and El Dorado refineries during the quarter.

“With the majority of the planned turnaround work behind us, we believe our diversified portfolio is well positioned to capture the margins available to us for the remainder of the year,” HF CEO Tim Go said.