The California refineries are selling gas for over $3.40 a gallon, so I would say they are quite profitable. CA has the highest gas prices in the nation, and I think there will be some negotiation on some of the more extreme environmental rules, like CO2 restrictions. The botttom line is the gasoline margins are healthy. And they aren't permiting any more refineries, so there is a scarcity value and the demand for gas keeps rising. I think the CA refineries are a huge plus.
This buyout or takeover bs is just that bs.
TSO just acquired 500 plus outlets in the midwest from Shell. They refine and retail with no middleman making all the profits. Why would they sell out now at the beginning of the economic cycle with nothing but upside ahead? IF they were a buyout target, it would have happened at $11 - $12.
IMO, Adami simply made a passing comment like so many of those pundits do, and the majority of those comments have zero merit. It was HIS passing thought. He is no refining industry expert. He is simply a trader! Just like that chick who said SHE would buy PUTS on FCX, when FCX was at $90, today $115. She nailed that one, right??? They are traders who are paid by CNBC to be on Fast Money, nothing more, nothing less, so take it for what it is, free information...
No takeover. No buyout. Only those folks imaginations...
However, let the rumors circulate as they tend to prop up the price...
Besides Conoco that Adami mentioned, here are some other possibilities:
1.Shell--has deal with TSO in upper midwest.
2. Occidental--might want to expand downstream, into refining and marketing?
3. Exxon--a few more refineries and retail outlets couldn't hurt, right?
4. Valero--combining with TSO would save costs; both based in San Antonio so cost savings could be enormous.
These are just a few of the possibilities based on pure speculation and no info I'm aware of besides pure logiAny one else have other possibilities?
Don't worry. Cramer said to sell about 4 weeks ago. Said it had run out of gas. That is why it's going up now. Chuckle.
Yep...Cramer definitely is a contrary indicator. You watch ... he will spin it so he looks good though. I believe he did about the same time RBC downgraded. Roughly.
So we have clear sailing from Cramer indicator.