In Q1 2025, global petroleum refiners reported strong earnings despite falling oil prices. U.S. Gulf Coast refiners processing Mars crude doubled margins to $16 per barrel, while margins rose to $7 in Singapore and jumped 36% in Asia for Arab Light crude. Stable demand for fuels like gasoline and diesel, combined with cheaper crude, boosted crack spreads and profits. While upstream margins declined and concerns over slowing global demand persist, refining margins have outperformed those in 2024, delivering a mixed but favorable quarter for refiners.
Marathon Petroleum reported a Q1 loss due to weak margins, maintenance, and downtime, while Chevron’s refining unit outperformed, offsetting low crude prices. Other U.S. refiners had mixed results: Valero’s profit dropped to $282 million amid maintenance and weak renewable diesel margins; Phillips 66 saw weaker refining margins but posted $796 million in net income, supported by midstream and chemical segments; Delek US reported a larger-than-expected $173 million loss due to market and operational challenges.
Despite uncertainties ahead—like potential OPEC+ supply hikes and the IEA cutting its 2025 demand forecast due to China’s weak economy—the refining sector remains resilient. Investors are optimistic about pure-play refiners as long as strong margins and low crude prices persist.
