What Can We Expect from Valero’s Diesel Crack Indicators in 2Q16?



Valero’s diesel crack indicators

Valero’s (VLO) diesel crack indicators have been rising in 2Q16 compared to 1Q16. The US West Coast (or USWC), where VLO has 0.3 MMbpd (million barrels per day) refining capacity, saw the largest rise of $3.20 per barrel in its diesel crack over 1Q16, to $14.40 per barrel in 2Q16.

The US Gulf Coast (or USGC), which has 1.7 MMbpd of VLO’s refining capacity, witnessed a rise of $1 per barrel over 1Q16, to $9.10 per barrel in 2Q16.

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Refining capacity for peers

Valero’s peer Marathon Petroleum (MPC) also has exposure to USGC. MPC has ~1 MMbpd refining capacity in USGC of its total 1.8 MMbpd capacity.

The PowerShares Dynamic Large Cap Value ETF (PWV) has ~5% exposure to energy sector stocks. PWV has VLO in its portfolio.


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