Why are refiners up when oil is @ all time high?

Discussion in 'Stocks' started by ByLoSellHi, Apr 16, 2008.

  1. It makes NO sense that the refiners popped today given that it's getting less and less profitable for them to refine crude oil as crude oil gets more expensive - especially the non-integrated refiners such as Valero, Tesoro, Frontier and Holly.
  2. Because there's not enough of them. Crude is available but refining capacity limits it's production and usability.
  3. check the crack spreads.
  4. dman666


    Well, if that's the case, why look at the fundamentals? Why not just trade price? It's the only thing you can truly trust.
  5. Capacity Utilization is literally at a 3 year low at 81.4%
    These guys have closed up shop until the refining spreads widen.
    Should most likely be a harbinger of a quick drop in crude soon.
  6. Valero is selling off refineries (Aruba) and literally shutting others (Corpus Christi), running at 73% utilization as a whole, because buying crude on the open market is crushing their margins, and their price is being bid up 5% today.
  7. piezoe


    They don't have to sell at a loss. In the US anyway. I'm expecting cuts in production to continue until either petrol prices rise or crude falls. I would expect that to happen before the summer is out.

    I like FTO at these prices, but it can go lower of course.
  8. UGHHHH!!!!!!!!

    Why are they pushing these higher when crude just busted through $119/bl??????

    They are ruining my desired trade, and are committing suicide.
  9. nitro


    I agree this is somewhat of a mystery. The nonlinearities are high.

  10. Daal


    there is nothing unusual about this

    refiners stock returns after periods of low margins
    Feb. 15, 1999
    April 5, 1999

    Jan. 17, 2000
    April 3, 2000

    Dec. 11, 2000
    May 28, 2001

    Dec. 15, 2003
    May 31, 2004

    Feb. 28, 2005
    April 25, 2005

    Feb. 13, 2006
    April 24, 2006

    Feb. 5, 2007
    May 14, 2007

    guess you guys havent heard of mean reversion
    #10     Apr 22, 2008