Phillips 66 Posts $9.41 Adjusted EPS as Refining Margins Double to $24.08 a Barrel

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Summary · why it matters

Phillips 66 reported second-quarter revenue of $52.04 billion and adjusted earnings per share of $9.41, beating the $8.0855 consensus, as worldwide realized refining margins doubled to $24.08 per barrel from $10.11 per barrel in the prior quarter. The result was the strongest quarterly performance since 2022, and the stock closed Friday at $272.99, up 116.03% year-to-date. The margin surge was industry-wide: Marathon Petroleum posted a Refining and Marketing margin of $36.33 per barrel versus $17.58 a year earlier with adjusted EPS of $17.73, while Valero Energy reported a blended refining margin of $23.62 per barrel and a Gulf Coast ULS diesel margin of $43.52 per barrel. CEO Mark Lashier called the setup a supply shock on the August 5 call, and Brian Mandell noted 7 million barrels a day of refining capacity offline in Asia and the Mideast plus another 1.4 million barrels a day down in Russia. Seven US refinery closures since 2019, including Phillips 66's own halt of fuel production at its Los Angeles refinery in 2025, set a structural floor, but management's bull case of $5.50 per barrel refining operating costs, $887 million returned in the quarter and net debt below $16 billion by year-end hinges on how long Russian and Persian Gulf barrels stay offline.

Impact on assets 3

Synthetic Biology (non-pharma)▲
Phillips 66
PSX
▲ PositiveSupplyrelevance

Phillips 66's realized refining margins doubled to $24.08/bbl and adjusted EPS of $9.41 beat consensus, driven by the supply shock from offline Russian and Persian Gulf refining capacity.

Marathon Petroleum Corp
MPC
▲ PositiveSupplyrelevance

Marathon's refining margin jumped to $36.33/bbl from $17.58 as the industry-wide supply shock (7M bpd offline in Asia/Mideast, 1.4M bpd in Russia, US refinery closures) lifted refining margins.

Valero Energy Corporation
VLO
▲ PositiveSupplyrelevance

Valero's blended refining margin of $23.62/bbl and Gulf Coast diesel margin of $43.52/bbl reflect the same industry-wide supply-driven margin surge.