G. Kahn

Refiners Finally Increase Margins

For Valero, in addition to the crack spread, the heavy/sour discounts are also quite important, as is the differential between gas/distillate futures and pump prices.

Valero owns a very large number of retailers. This has not been a factor for years, as gas stations have made minimal profits on gas, and have sunk more and more cash into the holding tanks. Last Q and current Q will see real profits on these operations, however, and high cash flow.