U.S. refiner Valero Energy Corporation (NYSE: VLO) reported on Wednesday. A net loss of $1.9 billion for Q1, compared to a profit for an equivalent period last year, after it took a $2-billion hit within the value of its inventory.
Valero Energy posted a net loss due to Valero stockholders of $1.9 billion, or $4.54 per share, for the primary quarter of 2020. This compares to net of $141 million. Or $0.34 per share, for the primary quarter last year.
The Refiner Reported
The refiner reported an after-tax lower of cost or market, or LCM. Inventory valuation adjustment of around $2.0 billion. This was the results of the market price of Valero’s inventories as of March 31, 2020, falling below their historical cost, “with the decline in market price resulting from the decline in petroleum and merchandise market prices related to the negative economic impacts from COVID-19,” the corporate said.
Valero Energy’s refining segment booked an operating loss of $2.1 billion for the primary quarter of 2020, compared to $479 million of operating income for Q1 2019.
Looking forward, Valero expects to take a position around $2.1 billion of capital this year, down by $400 million from the prior guidance. The $2.1 billion includes capital expenditures for turnarounds, catalysts, and venture investments.
“It’s been a really challenging start to the year with significant impacts on families. Communities and businesses world-wide brought on by the COVID-19 pandemic,” Joe Gorder, Valero Chairman and Chief military officer , said during a statement.
With the lockdown-induced demand collapse. Refiners within us are cutting refinery runs over the past month. China is now processing more petroleum. At its refineries than the world’s top oil consumer, the us , consistent with data from OilX.
Gasoline prices within the U.S. still fall thanks to the oil price slump, but demand is cratering. The EIA reported demand at 5.3 million bpd last week, a small increase. But still a particularly low rate compared to last April’s 9.45 million b/d average,” AAA said in the week . AAA believes that the national average could still decrease into May, possibly dropping as low as $1.65 a gallon.
“We haven’t seen gas prices that cheap since January 2009,” AAA spokesperson Jeanette Casselano said.
