Financial Data and Key Metrics Changes - For Q3 2025, net income attributable to Valero stockholders was $1.1 billion or $3.53 per share, compared to $364 million or $1.14 per share for Q3 2024, reflecting a significant increase [8] - Adjusted net income for Q3 2025 was $1.1 billion or $3.66 per share, up from $371 million or $1.16 per share in Q3 2024 [8] - Refining segment reported operating income of $1.6 billion for Q3 2025, compared to $565 million in Q3 2024 [8] - Net cash provided by operating activities was $1.9 billion in Q3 2025, with adjusted net cash provided being $1.6 billion [10] Business Line Data and Key Metrics Changes - Refining throughput volumes averaged 3.1 million barrels per day in Q3 2025, with a utilization rate of 97% [8] - The renewable diesel segment reported an operating loss of $28 million in Q3 2025, down from an operating income of $35 million in Q3 2024 [9] - The ethanol segment achieved $183 million of operating income in Q3 2025, compared to $153 million in Q3 2024, with production volumes averaging 4.6 million gallons per day [9] Market Data and Key Metrics Changes - Refining margins remained strong due to global demand and low inventory levels, despite high utilization rates [5] - Quality differentials for medium and heavy sour crudes have widened, with WCS trading at a 12% discount to Brent and Maya at a 14% discount [20] - Diesel demand in the U.S. was reported to be up 8% year-over-year in Valero's system, with overall diesel demand showing a 2% increase according to DOE data [51] Company Strategy and Development Direction - The company is progressing on the FCC unit optimization project at St. Charles Refinery, a $230 million initiative expected to enhance high-value product yields [6] - Valero plans to continue returning excess free cash flow to shareholders through stock buybacks, maintaining a payout ratio of 78% for Q3 2025 [11][33] - The company anticipates refining fundamentals to remain supported by low inventories and supply tightness, with limited capacity additions beyond 2025 [7] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about refining fundamentals remaining strong due to low inventories and geopolitical disruptions affecting supply [5][7] - The outlook for the ethanol segment remains positive due to strong domestic and export demand, supported by a record corn crop [40] - Management noted that the renewable diesel segment is expected to return to positive EBITDA, aided by lower fat prices and rationalization in the biodiesel market [42] Other Important Information - The company ended Q3 2025 with $8.4 billion in total debt and $4.8 billion in cash and cash equivalents, resulting in a debt-to-capitalization ratio of 18% [12] - Capital investments for 2025 are expected to be approximately $1.9 billion, with a significant portion allocated to sustaining the business [12] Q&A Session Summary Question: Insights on heavy crude differentials and availability - Management expressed disappointment in the impact of TMX on West Coast crude values, noting that most barrels are flowing to the Far East, and quality differentials have widened significantly [20][21] Question: Global capacity additions and reliability - Management indicated that while there are expected capacity additions, many new facilities may not reach nameplate capacity, leading to tighter supply-demand balances [26] Question: Impact of global outages on product markets - Management noted strong export demand and the inability to restock inventories in the U.S., which is keeping domestic markets tight [30] Question: Capital returns and stock buybacks - Management confirmed that excess free cash flow will continue to be directed towards share buybacks, maintaining a disciplined approach to capital returns [33] Question: Crude on the water and its destination - Management noted that most barrels are flowing to Asia, with increased Iraqi barrels expected in the U.S. market [39] Question: Performance of non-refining businesses - Ethanol is performing well due to strong demand and favorable conditions, while Diamond Green Diesel is returning to profitability [40][42] Question: Domestic gasoline demand trends - Management reported flat to slightly down gasoline demand year-over-year, with good export demand and stable fundamentals [50] Question: Technology advancements in operations - Management discussed the use of AI and robotics to improve operational efficiency and maintenance scheduling [56][86]

Financial Data and Key Metrics Changes - For Q3 2025, net income attributable to Valero stockholders was $1.1 billion or $3.53 per share, compared to $364 million or $1.14 per share for Q3 2024, indicating a significant increase [8] - Adjusted net income for Q3 2025 was $1.1 billion or $3.66 per share, up from $371 million or $1.16 per share in Q3 2024 [8] - Refining segment reported operating income of $1.6 billion for Q3 2025, compared to $565 million in Q3 2024 [8] - Net cash provided by operating activities was $1.9 billion in Q3 2025, with adjusted net cash provided being $1.6 billion [10][11] Business Line Data and Key Metrics Changes - Refining throughput volumes averaged 3.1 million barrels per day in Q3 2025, with a utilization rate of 97% [8] - The renewable diesel segment reported an operating loss of $28 million for Q3 2025, down from operating income of $35 million in Q3 2024 [9] - The ethanol segment achieved $183 million of operating income in Q3 2025, up from $153 million in Q3 2024, with production volumes averaging 4.6 million gallons per day [9] Market Data and Key Metrics Changes - Refining margins remained strong due to global demand and low inventory levels, despite high utilization rates [6] - Quality differentials for medium and heavy sour crudes have widened, with WCS trading at a 12% discount to Brent and Maya at a 14% discount [20] - Diesel demand in the U.S. saw an 8% year-over-year increase in Q3, with good agricultural demand contributing to this growth [52] Company Strategy and Development Direction - The company is progressing on the FCC unit optimization project at St. Charles Refinery, expected to enhance high-value product yields by 2026 [6][7] - The company anticipates continued support for refining fundamentals due to low inventories and supply tightness, with limited capacity additions beyond 2025 [7] - The company plans to return $1.3 billion to stockholders in Q3 2025, with a payout ratio of 78% [11] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about refining fundamentals remaining strong due to low inventories and geopolitical disruptions affecting supply [6][7] - The company expects refining throughput volumes to decrease slightly in Q4 2025, with cash operating expenses projected at approximately $4.80 per barrel [13] - Management noted that the market dynamics could lead to widening crude differentials, which may impact margins positively [20][21] Other Important Information - The company ended Q3 2025 with $8.4 billion in total debt and $4.8 billion in cash and cash equivalents, resulting in a debt-to-capitalization ratio of 18% [12] - Capital investments for 2025 are expected to be approximately $1.9 billion, with a focus on sustaining the business and growth initiatives [12] Q&A Session Summary Question: Insights on heavy crude differentials and TMX barrels - Management expressed disappointment that TMX has not significantly impacted West Coast crude values, with most barrels flowing to Asia [20] Question: Global capacity additions and reliability - Management indicated that while there are expected capacity additions, many new facilities may not reach nameplate capacity, leading to tighter supply-demand balances [26][27] Question: Impact of global outages on product markets - Management noted strong export demand and the inability to restock inventories in the U.S. is keeping domestic markets tight [31] Question: Capital returns and buybacks - Management confirmed that excess free cash flow will continue to be directed towards share buybacks, maintaining a disciplined approach to capital returns [34] Question: Crude on the water and its destination - Management highlighted that a significant amount of crude is flowing to Asia, with increased Iraqi barrels expected in the U.S. market [40] Question: Performance of ethanol and Diamond Green Diesel - Management reported strong ethanol demand and positive EBITDA for Diamond Green Diesel, with expectations for continued improvement [41][43] Question: Domestic gasoline demand trends - Management indicated that gasoline demand is flat to slightly down year-over-year, with good export demand offsetting domestic trends [52] Question: Technology advancements in operations - Management discussed the use of AI and robotics to improve operational efficiency and maintenance practices [58][89]

Financial Data and Key Metrics Changes - For 2025, net income attributable to Valero stockholders was $1.1 billion or $3.53 per share, compared to $364 million or $4 per share for 2024. Adjusted net income was $1.1 billion or $3.66 per share for 2025, compared to $371 million or $1.16 per share for 2024 [8][10] - The refining segment reported $1.6 billion of operating income for 2025, compared to $565 million for 2024. Adjusted operating income was $1.7 billion for 2025, compared to $568 million for 2024 [9][10] - Net cash provided by operating activities was $1.9 billion in 2025, with an adjusted net cash provided of $1.6 billion [11][12] Business Segment Data and Key Metrics Changes - Refining throughput volumes averaged 3.1 million barrels per day in 2025, with a 97% throughput capacity utilization [10] - The renewable diesel segment reported an operating loss of $28 million for 2025, compared to operating income of $35 million for 2024. Sales volumes averaged 2.7 million gallons per day in 2025 [10] - The ethanol segment reported $183 million of operating income for 2025, compared to $153 million for 2024, with production volumes averaging 4.6 million gallons per day [11] Market Data and Key Metrics Changes - Refining margins remained strong due to global demand and low inventory levels, despite high utilization rates [4][5] - Quality differentials for medium and heavy sour crudes have widened, with WCS trading at a 12% discount to Brent and Maya at a 14% discount [22] - Diesel demand in the U.S. saw an 8% year-over-year increase in sales, while gasoline demand was flat to slightly down [56] Company Strategy and Development Direction - The company is progressing on the FCC unit optimization project at the St. Charles refinery, expected to enhance high-value product yields [5] - Capital investments for 2025 are expected to be approximately $1.9 billion, with $1.6 billion allocated to sustaining the business and the remainder for growth [13] - The company plans to return $1.3 billion to stockholders in 2025, with a payout ratio of 78% for the quarter [12] Management's Comments on Operating Environment and Future Outlook - Management expects refining fundamentals to remain supported by low inventories and supply tightness, with planned refinery closures and limited capacity additions beyond 2025 [6] - The company anticipates that crude differentials will widen with increased OPEC plus and Canadian production [6] - Management expressed cautious optimism regarding the impact of AI and machine learning on operational efficiency and throughput sustainability [62] Other Important Information - The company ended the quarter with $8.4 billion of total debt and $4.8 billion of cash and cash equivalents, resulting in a debt to capitalization ratio of 18% [13] - The company is planning to cease refining operations at the Benicia refinery next year, which will incur approximately $100 million in incremental depreciation expense [11][15] Q&A Session Summary Question: Insights on heavy crude differentials and TMX impact - Management expressed disappointment that TMX has not significantly impacted West Coast crude values, with most barrels flowing to the Far East. Quality differentials have widened, benefiting the system [21][22] Question: Global capacity additions and reliability - Management indicated that while there are expected capacity additions, many new facilities may not reach nameplate capacity, leading to tighter supply-demand balances [30] Question: Impact of global outages on product markets - Management noted strong export demand, particularly for gasoline and diesel, despite global outages affecting margins [33] Question: Capital returns and share buybacks - Management confirmed that excess free cash flow will continue to be directed towards share buybacks, maintaining a disciplined capital return strategy [35] Question: Crude on the water and its destination - Management highlighted an increase in Iraqi barrels flowing to the U.S., while most other barrels are directed towards Asia [42] Question: Ethanol and DGD performance - Ethanol demand remains strong due to a record corn crop and increased global interest, while DGD margins have returned to positive EBITDA due to lower feedstock prices [44][46]

Financial Data and Key Metrics Changes - For Q3 2025, net income attributable to Valero stockholders was $1.1 billion or $3.53 per share, compared to $364 million or $1.14 per share for Q3 2024, reflecting a significant increase [6][8] - Adjusted net income for Q3 2025 was $1.1 billion or $3.66 per share, up from $371 million or $1.16 per share in Q3 2024 [6][8] - Refining segment operating income rose to $1.6 billion in Q3 2025 from $565 million in Q3 2024 [6][8] - Net cash provided by operating activities was $1.9 billion in Q3 2025, with adjusted net cash provided being $1.6 billion [9][10] Business Line Data and Key Metrics Changes - Refining throughput volumes averaged 3.1 million barrels per day with a utilization rate of 97% in Q3 2025 [7][8] - The renewable diesel segment reported an operating loss of $28 million in Q3 2025, down from an operating income of $35 million in Q3 2024 [8] - The ethanol segment achieved $183 million in operating income for Q3 2025, compared to $153 million in Q3 2024, with production volumes averaging 4.6 million gallons per day [8][9] Market Data and Key Metrics Changes - Refining margins remained strong due to global demand and low inventory levels, despite high utilization rates [4][5] - Quality differentials for heavy sour crudes widened, with WCS trading at a 12% discount to Brent and Maya at a 14% discount [18][20] - Diesel demand in the U.S. saw an 8% year-over-year increase in Q3 2025, driven by agricultural demand [45] Company Strategy and Development Direction - The company is progressing on the FCC unit optimization project at the St. Charles Refinery, a $230 million investment expected to begin operations in the second half of 2026 [5] - The company plans to maintain strong shareholder returns, having returned $1.3 billion to stockholders in Q3 2025 through dividends and stock buybacks [10][11] - Future refining fundamentals are expected to remain supported by low inventories and supply tightness, with limited capacity additions beyond 2025 [5][11] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about refining fundamentals remaining strong due to low inventories and geopolitical disruptions affecting supply [4][5] - The company anticipates that crude differentials will widen with increased OPEC+ and Canadian production [5] - Management noted that the market is reacting to potential Russian sanctions, which could impact supply dynamics and product cracks positively [21] Other Important Information - The company ended Q3 2025 with $8.4 billion in total debt and $4.8 billion in cash and cash equivalents, resulting in a debt-to-capitalization ratio of 18% [10][11] - Capital investments for 2025 are expected to be approximately $1.9 billion, with a focus on sustaining and growing the business [11][12] Q&A Session Summary Question: Insights on heavy crude differentials and TMX barrels - Management noted disappointment in TMX's impact on West Coast crude values, with heavy sour discounts widening significantly [18][20] Question: Global product markets and outages - Management highlighted strong export demand and the inability to restock inventories in the U.S., which is keeping domestic markets tight [26] Question: Capital returns and buybacks - Management confirmed that excess free cash flow will continue to be directed towards share buybacks, maintaining a strong capital discipline [28] Question: Crude on the water and its destination - Management indicated that most crude is flowing to Asia, with increased Iraqi barrels expected in the U.S. market [35] Question: DGD performance and profitability outlook - Management reported improved profitability for Diamond Green Diesel due to lower feedstock prices and strong SAF benefits, but noted uncertainties regarding future RVO impacts [95]

Core Insights - U.S. refiner Valero Energy reported an increase in third-quarter profit, attributed to a rebound in refining margins [1] Company Summary - Valero Energy experienced a rise in profit during the third quarter, indicating a positive trend in its financial performance [1] - The improvement in refining margins played a significant role in boosting the company's profitability [1] Industry Summary - The refining sector is witnessing a recovery, as evidenced by the rebound in refining margins, which is beneficial for companies like Valero Energy [1]

Core Insights - Sasol is making solid progress on its Capital Market's Day plans to strengthen its foundation business amid macroeconomic volatility, global tariffs, and geopolitical tensions [2] - The company reported a fatality at the Thubelisha Colliery in September 2025, despite achieving a fatality-free financial year in mining [2] Business Performance - In Southern Africa, the ramp-up of the destoning plant is on track, resulting in average sinks for Q1 FY26 reducing below 14%, which has enabled increased coal production [3] - Both Natref and Sasolburg showed improved operational performance, with higher sales volumes for Fuels and growth in the higher-margin mobility channel [3] - Chemicals Africa sales volumes remained consistent with the prior year, but revenue decreased due to lower sales prices amid market softness [3] - International Chemicals revenue increased in Q1 FY26 compared to the previous quarter, driven by margin optimization initiatives and higher sales volumes in the US [3] - Revenue and adjusted EBITDA were significantly higher compared to Q1 FY25, reflecting improved unit margins and operational excellence initiatives [3] Business Updates - The second of three new low-carbon boilers at Natref was successfully commissioned, enhancing steam reliability and supporting decarbonization objectives [4] - Sasol is taking measures to ensure operational continuity at the Natref refinery following the business rescue filing by Prax South Africa [5] - The mothballing of certain plants is progressing as planned, with clean-up activities completed for specific plants in Germany and the US [5] Outlook - Performance across all business segments is within market guidance, with good progress towards FY26 financial targets [6] - The Southern Africa value chain breakeven oil price for Q1 FY26 is in line with market guidance of US$55 - 60 per barrel, supported by higher production volumes [6] - International Chemicals is on track to meet the adjusted EBITDA target of US$450 - 550 million [6] Challenges - Despite progress, Sasol faces macroeconomic headwinds, including recent tariff changes impacting financial performance [7] - The company is actively assessing potential impacts on operations, supply chain, and pricing strategies due to global market adjustments [7]

Core Viewpoint - Par Pacific Holdings has successfully closed a joint venture to construct a renewable fuels facility in Hawaii, marking a significant step in its renewable energy initiatives [1][2]. Company Overview - Par Pacific Holdings, Inc. is headquartered in Houston, Texas, and operates in the energy sector, providing both renewable and conventional fuels to the western United States [3]. - The company has a refining capacity of 219,000 barrels per day across four locations and an extensive energy infrastructure network, including 13 million barrels of storage [3]. - Par Pacific also operates retail brands in Hawaii and the Pacific Northwest and holds a 46% stake in Laramie Energy, LLC, a natural gas production company [3]. Renewable Fuels Facility - The Renewable Fuels Facility is expected to be the largest in Hawaii, with a production capacity of approximately 61 million gallons per year of renewable diesel, sustainable aviation fuel, renewable naphtha, and low carbon liquefied petroleum gases [2]. - The facility is anticipated to be completed by the end of the year [2]. Joint Venture Details - Mitsubishi Corporation and ENEOS Corporation acquired a 36.5% equity stake in Hawaii Renewables for $100 million, while Par Pacific retains the remaining interest [1]. - Par Pacific will complete and operate the Renewable Fuels Facility through its affiliate, Par Hawaii Refining, LLC [1].

Core Insights - TotalEnergies SE (NYSE:TTE) experienced a share price increase of 7.32% from October 10 to October 17, 2025, ranking among the top gaining energy stocks during that week [1]. Group 1: Company Performance - TotalEnergies expects its oil and gas production for Q3 to reach 2.5 million barrels of oil equivalent per day (boe/d), reflecting a 4% year-over-year increase and exceeding its annual and quarterly guidance of more than 3% [3]. - The company anticipates growth in Q3 earnings and cash flow compared to the same period last year, driven by increased production and higher refining margins, despite a $10 per barrel decline in oil prices [3]. Group 2: Analyst Ratings - On October 10, 2025, Scotiabank analyst Paul Cheng raised the price target for TotalEnergies from $65 to $67 while maintaining a 'Sector Perform' rating on the shares, following an update of price targets for US Integrated Oil, Refining, and Large Cap E&P stocks [4].

Core Insights - Global equity markets experienced broad positive returns in Q3 2025, driven by resilient corporate earnings, enthusiasm for AI, and the U.S. Federal Reserve's first interest rate cut of the year [3][21] - Emerging markets, particularly China, led the gains, supported by a U.S. trade truce and strength in the tech sector [3][4] - The Polaris Global Equity Composite gained 5.04% (net of fees) for the quarter, underperforming the MSCI World Index, which returned 7.36% [5][6] Market Performance - Developed markets saw weaker currencies benefiting export-oriented indices, with Japan's TOPIX Index up 11.0% and the U.K.'s FTSE All-Share Index up 6.9% [4] - The U.S. market, represented by the S&P 500 Index, gained over 8%, primarily due to tech and communication stocks [4] - France and Germany underperformed due to geopolitical and fiscal concerns, with tepid growth projections under new U.S. trade policy [4] Sector Analysis - The healthcare sector was the best performer, with notable gains from pharmaceutical stocks, while financials, consumer discretionary, and IT also contributed positively [5][6] - Health insurers faced challenges, with UnitedHealth Group and CVS Health posting over 10% returns, while Elevance Health's shares dropped sharply due to profit guidance cuts [7] - In IT, Samsung Electronics excelled with strong performance in HBM technology and a significant deal with Tesla for AI chip manufacturing [11] Company Highlights - United Therapeutics Corp. was a top contributor to portfolio performance, driven by positive clinical trial results for its drug Tyvaso, potentially adding $4-5 billion in peak sales [6] - AbbVie, Inc. expects high single-digit revenue growth through 2029, with flagship drugs projected to exceed $31 billion in sales by 2027 [6] - The Carlyle Group Inc. outperformed in the financial sector, up over 20% due to strong fee-based credit and secondaries business [8] Investment Strategy - The current economic environment is characterized by a "two-speed" economy, with a concentrated AI-driven boom amidst subdued growth in other sectors [21][22] - Financials are seen as attractive due to stable net interest margins and loan growth, while defensives like consumer staples and healthcare are expected to perform well [22] - Opportunities in economically-sensitive sectors are being explored, with a focus on industrials benefiting from AI integration and supply chain modernization [22][23]

All right, let's talk energy now because your next guest just launched coverage of some big oil and gas companies for Wells Fargo. The report is titled, "Don't feed the bears, pay them dividends." Sam Margolan covering oil and gas for Wells Fargo joining us now. Sam, uh, welcome.On the big integrated side, you like Chevron, Exon, and Marathon Petroleum. Why are those stocks overweights right now even as the price of oil goes down almost every day. >> Yeah.Hey, thanks for having me. Um, you're right, the env ...