PSX’s 4Q15 earnings were better than estimated
In 4Q15, PSX’s adjusted net income of $710 million fell by 22% compared to 4Q14. The fall was mainly led by the midstream, chemicals, and marketing segments. This was partially offset by a rise in adjusted income from the refining segment.
PSX’s peers Marathon Petroleum (MPC), Tesoro (TSO), and Valero Energy (VLO) also witnessed rises in their GRMs in the third quarter. MPC, TSO, and VLO saw their GRMs widen by $2.7, $5.6, and $2.6 per barrel, respectively, over 3Q14 to $17.3, $20.5, and $14.4 per barrel, respectively, in 3Q15.
If you’re looking for exposure to refining sector stocks, you could consider the iShares North American Natural Resources ETF (IGE). The ETF has PSX, VLO, MPC, and TSO in its portfolio. IGE has ~10% exposure to refining and marketing sector stocks
Phillips 66 saw its gross refining margin (or GRM) rise by $0.1 per barrel over 4Q14 to $9.4 per barrel in 4Q15.
According to PSX, a $1 per barrel change in gasoline and the distillate crack spread affects its annual net income by $230 million and $200 million, respectively. In 4Q15, gasoline cracks have improved over 4Q14 across its operating areas of the Atlantic Basin and Europe, the Gulf Coast, the Central Corridor, and the Western Pacific. However, the distillate cracks fell across all zones, partially offsetting refining gains in 4Q15 compared to 4Q14.
On a sequential basis, PSX’s GRM fell by $4.6 per barrel over 3Q15. Gasoline and distillate cracks have narrowed in all PSX’s operating zones in 4Q15 compared to 3Q15, except for the West Coast (or Western Pacific) distillate crack, which has risen marginally.
WB is in Hawaii ! He has team of 230 profwessional working for Hathway and who does Buy or Sell ! The fact is 4.5% down for no reason whereas no other Oil Gas (XOM ) has fallen that today!
There are reports like that about American refineries, but you appreciate also that American refineries are limited, they are configured to use medium and heavy oil imported from around the world, that's why the Americans now are trying to sell a bit of their ultra-sweet oil to refineries in the Asia-Pacific region and Europe where it can be refined, and they are importing an equivalent amount of medium and heavy oil for American refineries to use: but you need a lot of infrastructure inside the U.S., like pipelines, to carry the light oil, very light oil into these refineries, and that will take many years to become operational. That's why America is trying to sell or export a bit of its very light oil, and import equivalent amounts to use in their refineries.
Sophie Shevarnadze: International oil economist, World Bank consultor, Dr. Mamdouh G. Salameh , thank you for being with us today. So, doctor, Saudi officials have denied reports that OPEC has offered a 5% oil production cut; however, there are signal coming from Riyadh and Baghdad that they are ready to accept the cuts, if OPEC agrees on it. Iran is not planning any cuts in the near future, and then you have President of Venezuela, an OPEC member, saying that world's top oil producers are close to forging a deal to restore oil prices. So, who are we to believe, who is bluffing here?
Mamdouh G. Salameh: There's no smoke without fire. Certainly, there has been a lot of reports about possible agreements between OPEC members and Russia about cutting oil production in order to bolster the oil price. Of course, OPEC waits for Russia also to help, but the fact remains that OPEC was responsible in the first place about the glut in the market, because its members have been producing 2.2 million barrels a day above their production sealing. So they have a responsibility towards the oil prices and towards their members to cut production. I am sure that if they do that, Russia will match their cut, but they are using, possibly, half a million barrel a day to support the oil price.
One who short this with millions are the one
- Chesapeake Energy Corporation (NYSE: CHK) stated today that Kirkland & Ellis LLP has served as one of Chesapeake's counsel since 2010 and continues to advise the company as it seeks to further strengthen its balance sheet following its recent debt exchange. Chesapeake currently has no plans to pursue bankruptcy and is aggressively seeking to maximize value for all shareholders.
According to the Natural Gas Supply Association, Chesapeake trailed only ExxonMobil among natural gas producers in the first half of 2015, at a volume of 2,979 MMcf per day.
Feb 7 (Reuters) - Less than two months into the year, the top U.S. shale oil companies have already cut their budget for 2016 a second time as the relentless drop in oil prices continues to erode their cash flow.
With oil prices firmly wedged in the low $30-per-barrel range, oil producers are deferring spending on new wells and projects.
"Companies' language has shifted towards preserving balance sheets and cash, and keeping expenditure within cash-flows, which means that budgets are going to fall further," said Topeka Capital Markets analyst Gabriele Sorbara.
Eighteen of the top 30 U.S. oil companies by output have so far outlined their spending plans for 2016. They have reduced their budget by 40 percent on average, steeper than most analysts' expectations, according to a Reuters analysis.
These 30 companies had, on average, lowered their spending plans for 2016 by more than 70 percent last year.
Some such as Hess Corp and ConocoPhillips, who had already planned to spend less this year than in 2015, have now further cut their capital expenditure targets. Others are expected to follow suit.
But, is there room for further cuts?
While reduced prices for oilfield services and increased efficiencies have helped companies scale back spending, many industry experts say there may not be room for further cuts.
"It's almost like a 80/20 rule - 80 pct of the cost reduction has already occurred, another 20 percent remains," said Rob Thummel, a portfolio manager at Tortoise Capital Advisors LLC.
Although, the reduced spending has not yet impacted shale output, production is expected to start falling by the end of the year.
"The capital cuts that the industry is making should result in ... a supply shock to the downside," ConocoPhillips' chief executive, Ryan Lance, said on Thursday.
U.S. crude oil production is expected to decline to 8.5 million barrels per day (mmb/d) in November 2016, from 9.2 mmb/d in December 2015, according to the U.S. Energy Information Administration.
Even if the supply cuts lead to a recovery in oil prices, spending on exploration and production is not expected to bounce back immediately.
"If you're burning cash during low oil prices - and the longer that happens, the more pressure on the balance sheet - that means in a recovery scenario, it's likely going to take longer for producers to commit to larger capex budgets," said Fraser McKay, an analyst at energy consultancy Wood Mackenzie.
I think Citi hire #$%$, By Katy Barnato she is stupid to report Mark Grant also a Psycho says " there is a cloude in Black hole and World economy trapped in ?death spiral?...LOL