Valero Swings To 2Q Loss On Margin Pressure

Valero Energy Corp. (VLO) swung to a second-quarter loss as an earlier strategy to process heavier grades of crude oil backfired amid falling sales volume and prices. In addition, diesel and jet fuel profit margins were weak.

Shares on Tuesday morning were down 3.84% at $18.05. The stock has lost nearly half of its value in the past 10 months, though it is up by a third since March.

U.S. refiners in past years invested in pricey equipment to process the cheaper, dirtier crude oil in order to boost their profit margins. But recently, prices for heavy and light grades of crude oil have nearly converged amid lower supplies of the lower-quality crude.

Read Full Article from Wall Street Journal

- Posted: 2009-07-28 09:44:04

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