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"The days of $20 spreads have passed," BAML says as it grows more cautious on refiners whose...

"The days of $20 spreads have passed," BAML says as it grows more cautious on refiners whose earnings face strong headwinds from the collapse in WTI-Brent spreads. The firm downgrades Marathon Petroleum (MPC) to Neutral from Buy, while also cutting HollyFrontier (HFC) and Calumet Specialty Products (CLMT). (earlier)
Comments (7)
  • jrloma
    , contributor
    Comments (6) | Send Message
     
    May as well close down the refiners, no more profit for them.
    5 Jul 2013, 10:24 AM Reply Like
  • beachie
    , contributor
    Comments (29) | Send Message
     
    HFC still in favorable position...they will continue to do well....pricing will balance out and margin will remain healthy...HFC has good access to light sweet crude as well as storage / pipeline agreements funded.
    5 Jul 2013, 11:08 AM Reply Like
  • Sting71
    , contributor
    Comments (72) | Send Message
     
    If you are vertically integrated like CLMT then the costs are past on to your customers. Very little impact on CLMT. They sell refined products that are several steps removed from the market price of oil along with gas, etc.
    5 Jul 2013, 11:10 AM Reply Like
  • jkoates
    , contributor
    Comments (7) | Send Message
     
    Remember the recent purchase of refining capacity was played as a diesel fuel plan. So there may be some impact but not as much as with those straight fuel refiners.
    5 Jul 2013, 12:33 PM Reply Like
  • EKL
    , contributor
    Comments (25) | Send Message
     
    With all of the additional oil production in the U.S. why do refiners suffer? Market demand is fixed for all grades of oil products and prices are elastic. I think CLMT is a BUY on any weakness.
    5 Jul 2013, 02:24 PM Reply Like
  • ComputerBlue
    , contributor
    Comments (681) | Send Message
     
    Agree. Though CLMT has added more fuel into the mix, theyre the least impacted. Their inland refineries are in near perfect locations. A buy on further weakness.
    5 Jul 2013, 03:24 PM Reply Like
  • JEHUNDEN
    , contributor
    Comments (35) | Send Message
     
    What is HFC paying for oil? I would be it isn't anything close to the WTI price. At least not this year.
    7 Jul 2013, 07:34 PM Reply Like
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