VLO - Earnings call transcript Q1 2024 | Valero Energy Corporation

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Operator

Greetings, and welcome to the Valero Energy Corp.

First Quarter 2024 Earnings Conference. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Homer Bhullar, Vice President, Investor Relations and Finance. Thank you. ahead. go Please

Homer Bhullar

Vice and other XXXX everyone, Lane Valero Corporation's team. and our Energy our our Gary Good Vice of Executive Conference welcome Valero's Call. Quarter President Executive Fraser, Jason Earnings and and are and With First CFO; CEO Simmons, several morning, COO; President; to President members me Riggs, management today senior

investorvalero.com. a Also the on copy, not reconciliations to additional you received earnings our call. financial release adjusted website would provide on have mentioned disclosures and release at can you our earnings on like attached find the and that are this one If and for metrics business tables segments information financial

could differ management's be including our expectations to future actual to now it Investor we've forward-looking are the are call. I or statements laws. provisions release factors contained contact of earnings to expectations, after filings press described federal predictions intended the If statement to the There release. like state team many that In our summary, says conference call these or have you SEC. and questions safe free results securities by after Relations statements would under from the covered the our any company's your the harbor that press in disclaimer reviewing release cause forward-looking this that those attention direct in and to on the the feel tables, in please with

remarks. the Now over opening call I'll to for Lane turn

Lane Riggs

everyone. and Thank morning, good Homer, you,

system. planned financial despite maintenance refining results our We for are the heavy strong pleased quarter to across report first

operations. from the to and safe long-standing undertaking ability to team's optimize Our commitment while maximize throughput our maintenance illustrates activities benefits and reliable

higher events. with demand demand supported remain product system Refining gasoline geopolitical same as strong heavy seasonally margins demand tight year. refining last with the was across turnarounds diesel and and wholesale about supply constrained our Product balances by by

project earnings enhance operational ahead and schedule fourth strategic competitive quarter is the continue XXXX. sustainable our projects long-term DGD We capability Port be and advantage. and expected expand SAF business progressing of execute to in to at or Arthur our now fuel is of of aviation

to the Green manufacturers With the Diesel of expected SAF of largest project, one world. of this in Diamond is become the completion

are of refining opportunities In utilization addition, assets. on we optimize cash our of flexibility, projects pursuing around feedstock our cycle capacity. shorter are and mix existing projects capitalize improve product maximizing that the These existing increasing value and optimizing margins and on focused conversion

were matured to amount paid million senior cash of XX. notes our the principal quarterly $X.XX $X.XX from on January, share. And per per X.X% share we On the $XXX the side, increased outstanding dividend we stock our that financial on common March in

and tight balances executing focused seasonably to supply our investments ahead, supported our the margins product we disciplined limited been season. shareholder our closing, the have additions excellence, remain product ahead maintaining capacity even hallmark returns. on commitment to in of remain things refining strategy, projects by startup beyond product capital we of the Looking low and announced XXXX. In year the new is to and refineries driving operating our that expected exceed of this well, around with term, inventories Longer expect demand

hand I'll Homer, that, with back So the you. call to

Homer Bhullar

Thanks, Lane.

or the for per Valero first income billion billion stockholders $X.XX quarter share per first was to attributable $X.XX XXXX, $X.X share compared net of XXXX. quarter to the For $X.X of or

were to utilization quarter up margin which in the million per reported XXXX. Operating quarter $X.X the share XXXX, due XXXX quarter the or million quarter to $X.X per of in compared was quarter XXX,XXX gallons First the income of volumes first quarter higher per compared The of costs of stockholders plant XXXX. Adjusted X.X the reported additional $X.X started billion day was share operating than first operating in quarter XXXX, volumes rates XXXX million of process net quarter in in gallons higher production first first quarter ramping $XX $XXX the first volumes Throughput was barrels income income Valero first segment higher of in first lower of and day to million was throughput fourth the quarter for to X.X of Diesel the $X.X diesel first averaged for operating XXXX XXXX. first was XXXX lower Ethanol first cash the attributable in per of Refining first the primarily which per of of $X.XX income lower compared impact X.X in $XX guidance of quarter quarter volumes of quarter the barrel XXXX or of the income million XXXX. first quarter of capacity billion $X.XX of XXXX from XXXX. the of the segment of XXXX XXXX. for quarter barrel, the for first first sales for of to of to Port quarter in per $X.XX $XXX diesel DGD compared to per for The up averaged segment renewable gallons than XXXX. $X.XX the due per day day of XXXX. Refining than quarter for and operating the million XXXX. billion quarter XXXX was Arthur the first XXX,XXX which the per first of adjusted million was income billion quarter ethanol operating the quarter in attributed XXXX throughput. Renewable XXXX. The higher the first $XX day. for were the XX% was refining of of first Renewable energy the expenses volumes lower averaged quarter sales than first gallons to million of

expense The was $XXX amount million effective provided $XXX was the unfavorable $XXX with interest depreciation was of associated operating was amortization quarter million, the For Included net working was joint was expense DGD. XX%. the expense tax G&A million. first rate by operating in provided by and expenses of million, were $XXX activities income tax cash Net quarter cash this $XXX from XXXX, and million activities $XXX $X.X venture XXXX. billion net adjusted other and of member in impact first capital share of million

billion Excluding net operating cash adjusted items, these XXXX. provided $X.X activities was by quarter the of first in

XXXX, of costs the growing for $XXX compliance $XXX balance activities, investing business, capital which and for the quarter and of million was Regarding first for regulatory million of sustaining made was including the in catalysts investments turnarounds, the business. we

joint member share the and DGD other to million Excluding investments of of Valero attributable first interest $XXX entities, other the variable XXXX. capital to venture in investments quarter capital attributable were

stock $X.X purchase our stockholders of of billion of first returned which Moving to billion XX% shares financing approximately count XXXX, in in ratio was $XXX million was million of for XX% year-end since we activities. Through common of $X quarter and reduced to the quarter. our X.X resulting by payout share the dividends the for repurchases, XXXX. over paid We a as have share

XX. principal of total senior mentioned, we quarter as ratio, as notes balance $XXX that on $X.X We of quarter respect capitalized billion net of March we obligations the ended of outstanding equivalents debt, billion million With the our $X.X of excluding was and XXXX. X.X% cash. XX% the with with amount And XX, lease equivalents. The $X.X cash repaid of of and finance cash Lane billion our ended sheet, matured $X.X March billion debt-to-capitalization cash available cash well liquidity, to and

for capital turnarounds, investments with and still $X We the towards guidance. our and for that About growth sustaining to half billion attributable expect venture regulatory to catalysts, low of is business XXXX compliance approximately refining and be approximately Turning of half includes to which joint carbon the expenditures fuels capital investments. to balance Valero towards $X.X billion, to projects. allocated the growth businesses

quarter modeling day. per refining at barrels million throughput volumes West expect XXX,XXX at barrels to following ranges: barrels XXX,XXX XXX,XXX Mid-Continent per day. operations, and our to day to second at within the at Atlantic X.XX Coast Gulf to fall barrels per XXX,XXX X.XX million For North day. Coast XXX,XXX per XXX,XXX to we

approximately the and which gallon, includes be to X.X we to noncash XXXX. respect to operating approximately Operating cash We gallon per be With barrel. expect volumes per expenses expenses renewable $X.XX sales in expect gallons segment, refining for $X.XX in billion diesel $X.XX depreciation the be second as in per quarter such amortization. should XXXX costs

should Our $X.XX average per as the amortization. costs which depreciation X.X expenses includes gallon Ethanol for per segment million produce quarter. noncash is expected gallon, $X.XX day Operating second per such gallons to and in

million. For and should total net interest be million be should about the second and expense amortization depreciation $XXX expense quarter, approximately $XXX

to For be XXXX, million. $XXX we G&A approximately expenses expect

Instructions]. [Operator remarks. That concludes our opening

Operator

coming first Today's Theresa Instructions] [Operator question of is Chen from Barclays.

Theresa Chen

outlook is happening product Lane's you to of respect what demand get sense a pullback? the earlier do think And on want from talking here, the your I recent and go jet specifically, comments. we'll maybe and where here? And supply from margins diesel from to with

Gary Simmons

levels we've equal the system, on about sales you some X% trending Overall, actually at to I'll year. see are than last thoughts and I give today can sales in gasoline we our some our -- system In year. seen to demand. product as to seeing we're Gary. insight market It's what continue in question. your then final higher last light strong trending Diesel

be the surprise all flat would indicate gasoline expect slightly when could upside. Diesel up year. think models some from see demand we compared I down slightly year. data, we Vehicle to is flat to to So the travel demand gasoline to to last at last we encouraging, would data look demand

freight and appear then better jet demand start However, up And indices the again, we to turning seeing year-over-year. some demand. could of fuel be indicate

I appears like that I to the headlines. that's be the in sell-off consistent really of to think with seeing. fact think some that market you're the And attributable reacting just distillates to isn't

chain. in then in So diesel lag the the Russia, very gets you a in attacks supply there's drone have particular, strong. But

So aren't that interruption really the in markets seeing diesel. physical

the drone In fact, actually higher. attacks exports following Russian was

to markets And but have kind of pretty to so are sold fall getting that, point the now exports the Russian off, starting off hard. we've where and dismissed finally we're

weak. stronger diesel I think too and to margins side are we are to the to And Europe here margins see, have margins to happened X in that don't Singapore being negative run, we point in unless has too get hydroskimming the on significant demand would that from negative, indicate going things need something on which on. diesel weak, is I would cracking are capacity

Theresa Chen

maybe you the things. such. going on through dynamics Russia, appreciate about Really of and the point following and looking side exports the at the diesel helpful. naptha I on And up Maybe

margins gasoline naptha of refining new the maybe capacity well, a what impact translation for octane net So to starts as is in imply if And like some more added, export economics? and off the the of that from to does the fall result? light as naphtha what

Gary Simmons

Yes.

in think is up and I meaningful discount a see So any pick lot of naphtha price that really price. gasoline, in of just to see the or pet-chem need naphtha to changes back order to flat crude you to tied demand for

as price As pet-chems. flat long it's as naphtha is hard a crude feedstock into for to high, compete

trying gasoline, then a in that blended into happens, order be the it strong get when creates home so naphtha to And octane which is to able pool. into find to gasoline

Operator

from Mehta coming is Goldman question Neil next Sachs. of The

Neil Mehta

and strong you $X quarter. level, you're the a guess view targeted ask guidance? do a And the we do the sustainable should run payout as floor cash repurchase investors to how of really billion as And the flow so to numbers I about above that well Another about anchor how you've think rate? that payout wanted as I

Jason Fraser

Neil, ask Homer to to Jason. address that I'm question. going is this

Homer Bhullar

more Yes, was we're and the which you'll a that XX%. pretty fact payout year we really last the at of cash, And XX%, quarter strength strong looking not ended think XX%. our had first in sheet the Neil, given build quarter the at I to remember, balance

a dividend to think as a now, So can that you are through-cycle where is in periods and long-term fundamentals commitment. But as the you sustaining think good, it strong, CapEx balance I like and covered, XX% can think floor. of is XX% the is of sheet growth range

cash buybacks. think I reasonably towards to go flow the any a to excess XX% XX% expect as and to So continue floor

Neil Mehta

And helpful, on just Homer. follow-up then That's projects. pull forward of Okay. the DGD. There was is SAF a

start-up. So it for looks like project 'XX is tracking well

once And think you type incremental about -- comes service, back do the of margins economics? SAF think the premium what's of sustain how on how barrels? could should just So into we what you the it of envelope

Eric Fisher

the said, be Yes, The Start-up going like this fourth is in Eric. is project well. the you -- quarter. project construction will

product have PTC. you've give there's As been IRA, benefits that far stated credits are, XXZ to see to state kind the a what or as uplift, that a I'll then you if quote feel think going Europe, Argus program tax what we what in and federal it's And of BTC good you of I of look in whether lot or that worth. in the see got be is the

we We've it sales, in interest meet to problem going moving project do got strong not a are our and at return that see threshold. returns

Operator

coming is question Wells Read next from The of Fargo. Roger

Roger Read

got Probably typically OPEC, got Yes. macro have we've I come Gulf the other out discipline the we now, day some we've some Crude any guess, to up, some differentials, heavier crudes some, back on almost exported of guess, that places to TMX tightness stuff of here. starting I from have Coast.

it, and what the crude, curious availability differentials? you're seeing on call on just So front expectations

Gary Simmons

Gary. Roger, Yes, is this

demand expected by a and with Gulf and differentials Coast. a to differentials turnaround saw the was widen. we crude in Demand season allowed U.S. which just the little was bit think in move heavy mainly first little the driven wider that we bit I off quarter,

that of start we we're fourth quarter we not year tell narrow relatively differentials I differentials until on third availability back supply-demand market. any get OPEC the having trouble through like. ramp feedstock, At the most more to or the believe consultant see what tight But than balances would be you'll terms this production production up. OPEC the maybe will indicate in just you, it's year you least the of would would of of back

Roger Read

last This -- market, time of that we enough. gasoline need we seasonally to earlier relative move follow saw have little above cracks your you've a what move any max cracks, the is doing would up. been that a over max then diesel cracks diesel here? years again. while, up above the sort there a you to year, of on of go But gasoline Fair diesel for or over about last comments the for And lean gasoline, structure reason a to blended into couple the outlook

Gary Simmons

No.

of of to kind lot swing more that you're tight think gasoline VGO. I diesel. feedstocks, by a In a intermediate forced then availability gets VGO market, either driven of or

of we'll So conversion forward. been how that moving able VGO okay. to the all to far, see have We've availability units, fill has goes been but

Operator

UBS. The next question is from coming of Manav Gupta

Manav Gupta

like these them other hear, and a on we guys. My not question refining quarter enough from was played it's what an Congrats even FCC. somewhere again, first have it thesis have the bear is out on doesn't here strong and assets the looks of doesn't read [indiscernible] hydrogen, one

So even not most products likely providing will be XXXX. year-end to maybe the market,

providing don't after dynamics. to market my come they these But they there's understand the start products XXXX, trying if wave X to aware in coming if even So point last is, are that you X this? the of somewhere on, global I'm a do ones or even really these are change supply big is, the the

again. So after this, market see tightening again, the up we could

could us you if So there? help out

Gary Simmons

Yes.

kind this terms several global new of where get of additions we you and years capacity then And was tightness. had you from additions. So see point you've peak where capacity exactly to forward, year outpaces new a described. we petroleum year demand This it like of significantly, refinery the see in

Manav Gupta

Perfect.

other see you The is that projects cost point big delayed, somewhere unique. are we get overruns, generally

are Your projects the start trying to get like you more answer already And than absolutely you. an moving And know have I'm -- best unique I'm how get announced because is this? the people keeps announcement, we understand and which I from that. forward we to hoping just the is date which actual doing

forward understand how are projects? your us pulling help So you

Lane Riggs

it what Manav, the to was to I speaks That's culture. going But it's Lane. say.

on into they're people, them ultimately not that they when right high sure willing Valero. who we very behalf working be with accountability people say them a, people discipline, hold work teamwork. members to adjacent right and is be high the and and and who them making make jobs are, right b, -- may much We and to accountable about they're of the other get have and team sure the culture to under necessarily competent; Our or the I

we're flat level a upper-level pretty have with we because organization. And visibility management a of high

the mean really accountability development once and are ultimately, all status anything secret we the where and the it's cycle starts. So know But it's about like not alignment, -- projects. all the we the I -- sauce. and there's in We understand project of competency that's

You got just to execute.

Operator

The Todd next question coming is Ryan from Sandler. of Piper

Ryan Todd

impact more Maybe have forward. But a the lot are ways, going happened what's light global across a can Mid-Con this. bit about light optimization on refineries light focus refining from not might crude going you this with refining across that we in a the broader general that's to similar with more for the TMX, system sweet mean does it's have on earlier. sort market? what sweet to talk system little optimization be, you a been some what and what on or system the I think of crude mean going optimized running about broader this to crude as impact on crude, particularly I there's always follow-up of mix or to that's supply utilization run more questions is for some more of the of think complex mean

Gary Simmons

Yes.

So is Gary. this

So barrels. the It's just that an globally, rebalancing of have TMX much impact. doesn't

West heavier you America think the go more and barrels some from East were Far to to that to and travel of Coast. the go see more I TMX West Coast there the barrels to the they'll South some starting won't going probably

some of cause lighter see the a logistics a that period clear that globally, here, off the completely diet. Western in time refiners a of that and of Canadian come heavies Mid-Continent impact. for on definitely they production switching we'll go some because and could back have to big not to We will So hard-to-see differentials

comment, light to units. the Coast a lighter the run your lower crude in that's because on to utilization diet as to we your certainly in yes, hit Gulf overall -- And try limits basically we resulted

Ryan Todd

probably with on the being right? And general something lighter, sets that's that's happening system across global crude a broader mix

Gary Simmons

Yes.

is in designed crudes. utilization think lower about average capacity because the sour numbers, results gravity X.X medium crude heavy most up I was which certainly and for overall, especially new all

Ryan Todd

you I been the renewable Diamond obviously, with soft broader and Diesel. low. a through here on spot Maybe think as margin pricing diesel to RINs gears -- we've mean switching Green LCFS about

and view back year that pieces the the whether in how As tighten of and into moving renewable diesel walk of the some XXXX? into relative it's this you that of you could of think through about profitability maybe you XXXX, outlook kind can improve eventually market part SAF then up or the

Gary Simmons

Yes.

year, shutdowns. seen think really projects in I news, some of in delays, We've that lot or of be capacity it's slows If RIN balance of are going even slowdowns, versus overall announcements the a balance the the question at year? some project that that how some look comes a DX startups of of the down, starting like. of end of this to rest does off-line up other the what the the

It's We more know and dart we RD exactly very end. negative. expecting now. on to how What all competition oil, BD see or do whether a products see is going oils. that's -- right a waste is were throw it's little long Ag difficult to look veg can we

We we seen would that much as the start-ups. we of considering haven't announced as thought

the the don't any we out balances is RVO the thing that of how the in rest see obligations. year, So for there change

capacity how going of into a fixed credit is question much a a still fixed obligation. bank it's in So

positive are contemplated programs if you is outlook And are because in to U.K. by of continue 'XX, this in, think going SAF number The the ramps the LCFS mandates be the demand. you year, would being to at term, at so still I of Canada in that kicking XXXX in create look Europe, still are that the strong. the long-term U.K. legislation RD longer look and

away And very are to product your your going SAF ability be for DGD. to from into beneficial diversify us, product to and diversification slate of your California

beyond. I So is 'XX 'XX and predict. the outlook a hard to still longer-term of like little

net-net. still think it's still the I long DXs, stays probably in -- it

continue it sort to So a be tough of might year.

long from positive lag to is from better pieces. but back price you moving quarter a the tell standpoint and still margin think I 'XX We the see the looks a think outlook, a But second little standpoint, beyond. sort term, with still hard of half all

Operator

The next of Royall from question John is JPMorgan. coming

John Royall

guess, my the industry. Valero for for So of on expectations and terms first is in maybe question turnarounds, broader I

in supply others Given second a turnaround heavy half as supply of the you and on and lighter it spring, quarter than we won't the expect a turnaround lower coming should because come season expected, out more the just U.S. but fall could global had see we that in usual? maybe

Greg Bram

first activity. John, I'll turnaround turnaround quarter, this Bram. is Greg Particularly, in had pretty a we heavy about our the talk load.

really work Coast You our being through when at on. had that we reflective It's lower. can Gulf much particularly the see going of just look that you throughput, the

Looking system we've to varying forward, our in as know, got on turnaround always you going activity degrees.

a The year first quarter times like will be are of period, the from we driven where standpoint. try and season tending year kind not of margin tends to that lighter, you're be kind there see to very the that's into other of certain by work heaviest periods And holiday the the that's go to what intensive. of just

plans. I as to won't different of speak our As so much periods far time,

typical of It where will the kind industry but like turnaround outages, But turnarounds. lands. change tell. We that indicating at and between about of like see of now it's activity. are information more looks and the we'll typical in have season lot when will things others that be see of fall the level looks A fourth to least early same to quarter so we the people the get something more range

John Royall

returns of and for on or just follow-up Neil's Great. And capital then I Jason on a Homer. had probably question

cash that's quarter comments and a first suggested payout the in what now. at going free essentially That's saw expectation -- full that Homer's we flow You're the forward.

that of era to seem have of peeling this you kind that where on it characterized to old XX% that returns to of new seem changing framework your the of to you to don't way given capital and you've be sheet back the at thought be kind is XX% in know I floor, things? want the looking but balance you any there of

Jason Fraser

Jason. about cycle. I can problem and you look actions the to behave know because is we it of is, being to at period behave stab we've sometimes that. going more above do a with think we years. to majority quarters cash. in long-term with as consistent it and you the of also past really, about take Well, -- is we're But Yes, that's than this time And that a expect target we I of that. couple the been ask to time, we regard indication I that talk indication of view but rather kind the above you our the and at we future through best any how several probably should mean, are don't see last a over said, us over more a as of the statement it

Operator

Laetsch question Stanley. is Jo of coming from Morgan next The

Joseph Laetsch

Congrats a on strong quarter.

this you SAF. announcement enough support timing to I is demand from then so, project? Just would trying an And the wanted back any So to would overall. think go online? first to if potentially Are after to potential come additional about -- facility seeing customers

Eric Fisher

Yes.

first the our I think we're -- of current project. interest with seeing commercial capacity terms the what the in exceeds

engineering on doing said, we've we're second project. the As

we've In that's decided to internally issue going on that that. terms always that we're an us, until to always that's about timing, committing of for talk not

cookie identical, view, of clearly say execution project time each are But units could the what cutters of to -- other. from the macro is be I'd all and is very that going you nearly similar. a The

develop to it's a internally we that see externally. of is we something It's we question when say So decide market and project not how would something difficult technically when be a would or challenging this fund.

Joseph Laetsch

we've in that refining I that makes hoping given Yes, comments back Great. and decline sense. exports was Do months, into earlier, months. dynamics over Asia margins? how seen And seen over think And your the on past of in you a up impacting think just go the dig then U.S. also to tick to been margins then recent China we're do close there? that's we've couple floor you

Gary Simmons

Yes.

when negative capacity Europe run we So comment start margins need in and we've you there, to think margins have negative, tick have back cracking to of margins it I tells floor, hit hydroskimming in I think Singapore up. my you the you and you'll a see kind

Operator

coming is from question of Scotia. next Cheng Paul The

Paul Cheng

Gary and which The either up, [indiscernible] bring mix first oil WCS, really the that's going and so start heavy for Lane. is Peer question, for [indiscernible] with or I [indiscernible]. the main mostly think, to heavy is in mix barrels

Middle will convert right, heavy also East, barrel can That's is with happens, if your WCS? form first say, convert from simple? barrel intake -- eliminate the And that of [indiscernible] whether or is all from the your price be combination able system will WCS to able question. as when the So the the that your using light be replacing some the some all system into industry your heavy a intake not of say, to, and import from, plus all the medium

Gary Simmons

this Paul, is Gary. Yes,

the the the a really that anticipate designed just Benicia lot we there's we run what And on think example. I was refinery A&S. think coming barrels with use Benicia our West capacity of an Coast. I'll similar heavies as something to West A&S. are lights, coking both be be will like to to looks that. Coast doing you'll would refiners form and together TMX expect we to able something off And blend the a those that lot most

Paul Cheng

and Gary, Mexican then, ] maybe gasoline that what both the in comments question diesel? see you give [ for second And us market you your Okay. some can

Gary Simmons

Yes.

historic just have consistent Mexico barrels in a We're with sales over our selling So XXX,XXX been levels. day.

up of later competitive We will this expect allow make the year our see in north Altamira to demand when us in Mexico that continue marine terminal volumes grow remains in to ramp kind very would strong. up Mexico. we to running, expect more that in We get us and and

Paul Cheng

number can export Gary, in you share you quarter. first have do an the

Gary Simmons

Yes.

a of of number result XXX,XXX first as I and did wouldn't demand. year-over-year, read The jet So export. in heavy That a for exports. available XXX,XXX quarter-over-quarter, of diesel the down really XX,XXX diesel barrels have gasoline and quarter the just that was day day barrels exports. did a We didn't of we we of exports lack and turnaround activity barrels was barrels

Operator

from The coming question Blair next Pickering, Holt. is of Matthew Tudor,

Matthew Blair

for about you I on did deal. appetite overall regarding M&A major talk you outlook your a changed refining think Could M&A? assets? anything about a Has your it's decade been since

Lane Riggs

most Lane. to there if we as I I corporation we that's deal you Not look engage the of [indiscernible] that. mean not sorted really. This sort look a in everything. out big decided is at always mean at prompt

wants reason, the everything look whoever whatever to them at assets, at buyer of For some liquidate the time. we'll successful out can they certainly that sort

But in terms a also, everything, refineries because to make full of refinery done at acquiring, cost certainly the we we merging look but company, we the level it we that expect. and run and and buying at we a have much so as understand philosophy,

to And the ultimately, our valuation that so goes into models.

Operator

The next Cowen. question TD is Gabelman of Jason coming from

Jason Gabelman

X I questions. had market-based

first, elevated there? Coast ratable a be into wanted or of now shut Are coming expect another West overseas market just as seeing to permanently we there? into will the you're you from asset kind prices down The that the sense seeing you and that heightened on volatility what exports get of product-wise move summer do

Gary Simmons

Yes.

and normal And gasoline, in the little put to the California Gary. kind just for So weather. I market. demand would lower return speculate think on in our to seen to system, this saw difficult a we you, California very barrels I patterns. import water it's of related at first demand, is tell We've the to least quarter, which was

on to go import lot people doing think that, for into see and ahead the before don't would of the are we a market put need you and barrels California. you react water So

dependent really there it refineries run West is Coast all will driving lot throughout how the of we season. on on and the So volatility a think be

Jason Gabelman

And to X to it. global percentage X on slate. the comment around back up past reduced Can and then lighting crude comment my just a to you going capacity that question, Got commentary X points And has years crude available gravity X maybe second just global previously you over that's the few points. dynamic? the gone made that had by

Gary Simmons

a there's gravity heavier It as do that have? crude capacity world some lot for that. I know quantifying know can that don't higher, causes designed Greg, but crude I derate can don't it. around don't was I I if refining that. diet. that that gravity units, of the that our quantify a is Certainly, you the know, crude I view goes

Greg Bram

don't of thumb I any rules either. have

Operator

I turn back time, At Bhullar to would this comments. Mr. for floor over the closing to like

Homer Bhullar

Thank day. you, follow-up questions. to any and Donna. feel Appreciate a everyone joining great you, us. free the Thank have if IR everyone, Obviously, have team please you contact

Operator

Ladies This concludes gentlemen, your participation. event. for you and today's thank

disconnect webcast, rest may and at lines your or the log time You off day. enjoy your the of this

Valero Energy (VLO) 25 Apr 242024 Q1 Earnings call transcript