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Asia Markets

Update: US Equity Indexes Decline, Crude Oil Jumps as Trump's Threats to Strike Iran Again Elevate Geopolitical Risk

(Updates with index/price moves, macroeconomic data, and political news from the first paragraph.)US equity indexes fell while volatility jumped with crude oil and government bond yields after President Donald Trump warned of more strikes on Iran after saying a peace deal signed in June "is over"The Dow Jones Industrial Average dropped 1.2% to 52,294.8, with the Nasdaq Composite down 0.2% to 25,760.5, and the S&P 500 lower by 0.5% to 7,469.1 after midday Wednesday.Energy was the standout gainer, with Valero Energy (VLO), Occidental Petroleum (OXY), and Phillips 66 (PSX) leading the S&P 500. Chevron (CVX) was the Dow's top gainer. On Nasdaq, the top spot went to Baker Hughes (BKR).The CBOE Volatility Index jumped 6% to 17 after Trump said, per a Bloomberg report, the US would probably launch further strikes on Iran and could resume a blockade on the country's ports.American forces launched strikes against more than 80 targets in Iran, including air defense systems, command-and-control networks, coastal radar installations and anti-ship missile capabilities, in response to recent attacks on commercial shipping in the Strait of Hormuz, according to a Deutsche Bank note on Wednesday. The strikes were accompanied by the US Treasury's decision to revoke a waiver that had allowed new Iranian oil sales, it said."We hit them very hard last night," Trump said Wednesday on the sidelines of a summit of the North Atlantic Treaty Organization leaders in Ankara, Turkey. "Probably hit them hard again tonight."The front-month global benchmark North Sea Brent soared 7% to $79.37 a barrel, and the US West Texas Intermediate surged 6.9% to $75.29 a barrel.After the burial ceremony of Iran's Supreme Leader Ayatollah Ali Khamenei - killed by an Israeli strike at the outset of the conflict - ends on July 9, both warring sides could adopt an even harder stance, driving a further uptick in geopolitical risk premiums, according to a note from Rystad Energy."Even if no sustained physical disruption materializes, uncertainty around vessel safety, insurance costs, potential delays, and the risk of further retaliation is likely to keep volatility elevated in the near term," the Rystad note said.US Treasury yields rose, reflecting market concern that higher crude oil prices, driven by a supply shock, will make it harder for the Federal Reserve to fight inflation. The two-year yield jumped 5.8 basis points to 4.22%, and the 10-year climbed 6.2 basis points to 4.59%.Inflation concerns also sent gold futures down 2.7% to $4,045.6 and silver futures lower by 5.5% to $57.98.In economic news, the minutes from the Fed's policy meeting on June 16-17 are due at 2 pm ET. Investors will parse the views on the direction of interest rates at a time when the market is pricing in hikes. The probability of a 25-basis-point increase in rates is the highest among all other policy outcomes in September, October, and December, the CME FedWatch tool showed Wednesday.Meanwhile, in company news, Apple (AAPL) said Wednesday that Broadcom (AVGO) will produce chips for use in the iPhone maker's products in a deal likely worth more than $30 billion.

Dow JonesNasdaq CompositeS&P 500$AAPL.AVGO$BKR$CVX$OXY$PSX$VLO
Japan

Update: US Equity Indexes Slide, Crude Oil Surges After Trump Threatens More Strikes on Iran

(Updates with index/price moves and political news from the first paragraph.)US equity indexes slumped while volatility surged with crude oil and government bond yields after President Donald Trump warned of more strikes on Iran after saying a peace deal signed in June "is over"The Dow Jones Industrial Average dropped 1.5% to 52,107.8, with the Nasdaq Composite down 1% to 25,572.5, and the S&P 500 lower by 1% to 7,434.1 after midday Wednesday.Energy was the standout gainer, with Valero Energy (VLO), Occidental Petroleum (OXY), and Phillips 66 (PSX) leading the S&P 500. Chevron (CVX) was the Dow's top gainer. On Nasdaq, the top spot went to Baker Hughes (BKR).The CBOE Volatility Index jumped 13% to 18.18 after Trump said, per a Bloomberg report, the US would probably launch further strikes on Iran and could resume a blockade on the country's ports."We hit them very hard last night," Trump said Wednesday on the sidelines of a summit of the North Atlantic Treaty Organization leaders in Ankara, Turkey. "Probably hit them hard again tonight."The front-month global benchmark North Sea Brent soared 7% to $79.37 a barrel, and the US West Texas Intermediate surged 6.9% to $75.29 a barrel.US Treasury yields rose, with the two-year yield jumping 5.8 basis points to $4.22% and the 10-year climbing 6.2 basis points to 4.59%.

Dow JonesNasdaq CompositeS&P 500$BKR$CVX$OXY$PSX$VLO
Commodities

US Refiners Poised to Beat Q3 Estimates on Strong Product Margins, TPH Energy Says

TPH Energy Research expects US independent refiners to deliver stronger-than-expected Q3 earnings as gasoline and diesel margins remain robust, it said in a Tuesday note.TPH raised its average Q3 earnings per share estimate for the sector to $5.83 from $4.97, above the consensus forecast of $5.22 per share.TPH still expects earnings to remain below its Q2 estimate of $6.18 and the Street's $5.74.TPH said refining margins have started the third quarter strongly, supported by an unusual seasonal increase in US gasoline margins.TPH said its US gasoline margin indicator increased to $35 per barrel in Q3 from $28 per barrel in Q2, after adjusting for Renewable Volume Obligation costs and measuring against Brent crude.US gasoline inventories have fallen to five-year lows and stand 6% below the five-year average, while gasoline yields have remained about 3 percentage points below normal over the past two weeks as refiners favored diesel production, the brokerage said.Diesel margins also improved, with TPH's US futures indicator increasing to $49/bbl in Q3 from $48/bbl in Q2 despite the US-Iran peace agreement.Low inventories, Russian refinery outages and a steeper global cost curve continued supporting diesel markets.TPH said crude differentials have narrowed against Brent for several grades, including WTI-Cushing, Syncrude, Western Canadian Select at Hardisty, Western Canadian Select at Houston and Alaska North Slope, creating a modest headwind for refiners.Company-specific indicators also strengthened early in the quarter, with Valero Energy (VLO) up $7.86/bbl from the prior quarter, Phillips 66 (PSX) up $5.71/bbl and Marathon Petroleum (MPC) up $4.08/bbl, according to TPH.The firm said lower crude backwardation, wider octane spreads and cheaper tanker rates should improve capture rates. Backwardation indicates strong near-term demand or constrained spot supply, with futures prices trading below spot prices.However, weaker jet fuel margins relative to diesel, flat crude prices and a roughly $2/bbl increase in Renewable Volume Obligation costs will offset some of those gains.TPH expects Midwest ethanol margins to improve by about 3 cents per gallon from the Q2 on stronger co-product returns, while retail operations recover. Renewable diesel and polyethylene margins are expected to weaken.Analysts forecast the largest earnings upside versus consensus for Valero Energy, HF Sinclair (DINO) and Par Pacific Holdings (PARR), while maintaining estimates below consensus for PBF Energy (PBF) and CVR Energy (CVI).TPH expects refiners to increase shareholder distributions in Q3 after limiting returns in Q2 because of market volatility.The firm forecasts an average total capital return yield of 9% in Q3, up from 5% in Q2, led by Marathon Petroleum, Valero Energy, Par Pacific Holdings, HF Sinclair and Delek US Holdings (DK).

$CVI$DINO$DK$MPC$PARR$PBF$PSX$VLO
Commodities

US Refining Margins Weakened in June, Q2 Trends Remained Strong, TPH Says

US refining indicators declined across the major refiners in June as weaker gasoline and diesel margins and narrower crude differentials weighed on profitability, although second-quarter performance remained well above the prior quarter, TPH Energy Research analyst Matthew Blair said in a Thursday note.Among the large-cap refiners, Phillips 66 (PSX) posted the greatest quarterly improvement. Its refining indicator slipped to $26.23 per barrel in June from $29.45 in May, but still finished the second quarter up $17.22/bbl from the first quarter. The company benefited from a sharp decline in crude prices late in the month, which supported its Central Corridor operations, while Gulf Coast margins were aided by a lag in refined product pricing. West Coast performance also exceeded expectations.Valero Energy's (VLO) refining indicator fell to $27.58/bbl in June from $33.70 in May as refining economics weakened across all regions, particularly on the West Coast. Despite the monthly decline, the indicator increased by $12.23/bbl quarter over quarter. The company also saw stronger economics for ethanol and renewable diesel during the quarter, supported by lower corn and feedstock costs and stronger renewable fuel credits.Marathon Petroleum's (MPC) refining and marketing indicator dropped to $27.50/bbl in June from $35.88 in May, with the sharpest deterioration in the Mid-Continent region, followed by the West Coast and Gulf Coast. Wider sweet crude differentials and improved market structure partially offset the weakness.Even so, Marathon's indicator finished the second quarter up $14.21/bbl from the first quarter.Overall, June marked a pullback from May's stronger refining environment, but second-quarter indicators remained significantly higher than first-quarter levels across the sector.Price: $177.09, Change: $+2.59, Percent Change: +1.48%

$MPC$PSX$VLO
Equities

JPMorgan Adjusts Price Target on Valero Energy to $294 From $299, Maintains Overweight Rating

Valero Energy (VLO) has an average rating of overweight and mean price target of $269.88, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

$VLO
Equities

Goldman Sachs Adjusts Price Target on Valero Energy to $286 From $283, Maintains Buy Rating

Valero Energy (VLO) has an average rating of overweight and mean price target of $270.18, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

$VLO
Equities

Barclays Adjusts Price Target on Valero Energy to $279 From $261, Maintains Overweight Rating

Valero Energy (VLO) has an average rating of overweight and mean price target of $270.18, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

$VLO
Commodities

Refiners Outperform Broader Market on Stronger Fuel Margins, TPH Energy Says

Renewed Middle East supply concerns boosted refining equities and fuel margins last week, while second-quarter refining fundamentals continued to improve, TPH Energy said in a Monday note.US refining stocks climbed 7.6% last week, outperforming the S&P 500's 2.0% decline after tensions between the US and Iran intensified. The note cited Iran's strike on a cargo ship and the US response targeting drone and missile storage sites.Among refiners, PBF Energy (PBF) gained 15.6%, Delek US Holdings (DK) rose 15.3%, and Valero Energy (VLO) advanced 9.8%. CVR Energy (CVI) fell 1.1% after unexpectedly replacing its chief executive officer, TPH Energy said.Gasoline cracks strengthened across key regions, with US margins rising $6 per barrel to $32/bbl, Northwest Europe gaining $5/bbl to $29/bbl, Singapore increasing $1/bbl to $31/bbl, and 2026 gasoline futures climbing $1/bbl to $14/bbl, TPH said.Diesel cracks also moved higher, as US margins increased $3/bbl to $38/bbl, Northwest Europe rose$7/bbl to $41/bbl, Singapore added $1/bbl to $42/bbl, and 2026 diesel futures advanced $2/bbl to $35/bbl, TPH added.TPH expects second-quarter 2026 product cracks to post their strongest quarterly performance since the second quarter of 2022. US gasoline cracks are on pace to rise $16/bbl quarter over quarter to $25/bbl, while US diesel cracks are expected to increase $15/bbl to $45/bbl.The Southwest posted the greatest improvement in refining margins, both quarter-over-quarter and year-over-year. The West Coast recorded the smallest quarterly gain, while the Mid-Continent showed the weakest year-over-year improvement, TPH said.Higher crude differentials offset part of the stronger refining margins as several grades tightened against Brent. West Texas Intermediate tightened by $1/bbl, Louisiana Light Sweet by $2/bbl, Mars by $4/bbl, Maya by $3/bbl, Bakken by $7/bbl, Syncrude by $5/bbl, West Texas Sour by $2/bbl, and Alaska North Slope by $11/bbl, the company added.Western Canadian Select widened by $4/bbl at Hardisty and $1/bbl at Houston. TPH also expects the West Texas Intermediate market structure to reduce the value of US inland barrels by $5/bbl during the second quarter.

$CVI$DK$PBF$VLO
Commodities

US Refining Capacity Falls in 2025 After Major Plant Closures, EIA Says

US refinery capacity fell in 2025 as the permanent closure of two major plants outweighed marginal efficiency gains across the industry, Energy Information Administration strategists said in a note on Monday.EIA analysts said operable atmospheric distillation capacity totaled 18.2 million barrels per calendar day as of Jan. 1. The figure represents a decline of more than 250,000 b/cd, or about 1%, compared with the same period a year earlier, the analysts said.The contraction leaves the US with 130 operable refineries, two fewer than in 2025.The EIA said the decline was driven by the shutdown of two refineries in 2025, including a 263,776-b/d facility in Houston operated by LyondellBasell (LYB) and a 138,700-b/d refinery in Los Angeles owned by Phillips 66 (PSX).Combined, the two closures removed about 400,000 b/d of capacity from the market.However, the agency said incremental capacity expansions and process improvements at existing refineries partially offset the reduction. The EIA identified 130 operable refineries in the US as of Jan. 1, down from 132 a year earlier.The closure of the Phillips 66 Los Angeles facility represented a 5% reduction in refining capacity on the US West Coast, within the Petroleum Administration for Defense District 5.The EIA said that while Valero Energy's (VLO) 145,000-b/d Benicia refinery in California remained operational as of Jan. 1, the facility has since ceased refining operations and was removed from the agency's monthly capacity estimates beginning in March 2026.The closure of the LyondellBasell refinery, by contrast, represented a smaller proportional impact on the US Gulf Coast refining system, accounting for about 3% of capacity in PADD 3, where refining output exceeds regional fuel demand.Overall Gulf Coast refining capacity declined by less than 2% in 2025 after accounting for capacity additions elsewhere in the region, the EIA said.The agency said that the three largest US refiners, Marathon Petroleum (MPC), Valero Energy and Exxon Mobil (XOM), each reported calendar-day capacity increases of less than 1% compared with 2025, reflecting what it described as small-scale operational improvements rather than major expansion projects.Phillips 66 recorded an overall decline in capacity following the closure of its Los Angeles facility.Meanwhile, Chevron (CVX) overtook PBF Energy (PBF) to become the fifth-largest US refiner after posting modest capacity gains.Motiva Enterprises' Port Arthur refinery in Texas retained its position as the largest US refinery by calendar-day capacity at 656,000 b/d, while Marathon Petroleum's Galveston Bay refinery remained the country's largest on a stream-day basis, with a capacity of 678,000 barrels per stream day.Price: $177.06, Change: $+5.41, Percent Change: +3.15%

$MPC$PSX$VLO$XOM
Equities

TD Cowen Adjusts Price Target on Valero Energy to $292 From $276, Maintains Hold Rating

Valero Energy (VLO) has an average rating of overweight and mean price target of $268.94, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

$VLO
Commodities

Trump Pushes to Make Year-Round E15 Sales Permanent, TPH Says

The Trump administration is seeking permanent authorization for year-round sales of E15 gasoline, a move that could modestly boost US ethanol demand and support biofuel producers, TPH Energy strategists said in a Thursday note.Matthew Blair, an analyst at TPH Energy, said that the White House Office of Management and Budget has requested legislation to allow the higher-ethanol fuel blend to be sold year-round as part of a supplemental budget proposal.The measure follows the passage of a similar bill in the House of Representatives in May, though its prospects in the Senate remain uncertain.TPH analysts said E15, a gasoline blend containing 15% ethanol, is currently restricted during the summer months in much of the US due to concerns that its higher volatility could contribute to smog formation in hot weather.Federal regulators have routinely issued temporary waivers to allow summertime sales, but the latest proposal would make those permissions permanent.The move marks the latest step by the administration to support the US biofuels industry, a key constituency in agricultural states across the Midwest.Though the potential increase in demand may be limited initially, analysts say even incremental gains in ethanol blending rates could benefit major producers, including Green Plains (GPRE), Archer-Daniels-Midland (ADM) and Valero Energy (VLO).There are fewer than 5,000 E15 pumps across the US, representing less than 2% market share, Blair said, adding that even with approval for year-round E15, actual volumes would likely remain quite small at first.However, TPH said ethanol's current pricing advantage over gasoline could encourage wider adoption. Midwest ethanol is trading at about $1.85 per gallon, compared with about $2.92 per gallon for Midwest gasoline.The US consumed about 13.6 billion gallons of ethanol last year, largely unchanged from the previous year and below pre-pandemic levels.TPH said a permanent shift to year-round E15 sales would likely provide a gradual increase in domestic ethanol demand rather than an immediate surge, analysts said. However, at a time when US biofuel consumption has stagnated, even modest growth could improve margins and utilization rates for ethanol producers.The proposal now faces the more difficult challenge of securing Senate approval, where bipartisan support for biofuel legislation has historically been uneven despite backing from farm-state lawmakers and the ethanol industry.Price: $251.73, Change: $+9.29, Percent Change: +3.83%

$ADM$GPRE$VLO
Oil & Energy

US Refining Indicators Weaken in June as Crack Spreads Soften, Q2 Gains Hold, TPH Energy Says

US refining margins have softened heading into the end of the second quarter, pressured by falling gasoline and diesel cracks following progress on a peace deal between the US and Iran, TPH Energy strategists said in a note on Tuesday.TPH analysts said company-specific refining indicators are trading down by $5 to $11 per barrel month-to-date in June, reflecting a broader cooling in energy markets.Matthew Blair, analyst at TPH Energy, said that while the geopolitical developments have weighed on product cracks, the impact across the sector has been uneven.Par Pacific Holdings (PARR) has demonstrated the most resilience among the group, with its refining indicator down $4.94 per barrel month-to-date.TPH said that the Singapore market, a key benchmark, has declined slightly and remains well above its five-year average, while falling crude prices have provided a tailwind for asphalt indicators.The bank said that large-cap refiners show a more mixed picture. Phillips 66 (PSX) is down $7.36/bbl month-on-month but is seen benefiting from potential derivative gains linked to falling crude prices.Valero Energy (VLO) has declined by $7.50/bbl, with strength in Gulf Coast diesel partially offsetting the narrowing of crude differentials.HF Sinclair (DINO) is down $8.03/bbl amid weakness in West Coast and Rockies cracks, though improved Southwest markets partly cushion the impact.Meanwhile, Marathon Petroleum (MPC) shows the steepest monthly decline at $10.85/bbl, driven by softness in Midcontinent refining margins.However, despite the monthly weakness, TPH still expects strong quarter-to-date performance across the sector.Phillips 66 leads gains at $15.84/bbl, followed by Par Pacific at $15.03/bbl, Marathon Petroleum at $13.39/bbl, Valero Energy at $11.77/bbl, and HF Sinclair at $11.13/bbl.Price: $50.94, Change: $-0.11, Percent Change: -0.22%

$DINO$MPC$PARR$PSX$VLO
Commodities

Gulf Coast Heavy Crude Spreads Diverge Amid Supply Constraints, TPH Says

US Gulf Coast heavy crude markets are showing signs of divergence as widening discounts for Mexico's Maya blend clash with tightening supplies of Western Canadian Select, TPH Energy strategists said in a note on Monday.Matthew Blair, TPH Energy analyst, said that the market for Maya crude has weakened, with state-owned Pemex widening its discretionary "K factor" price adjustment to a $ 9.20-per-barrel discount for July, steeper than the $8.15 set in June and $4.35 in May.TPH analysts forecast that the move will push Maya-Brent differentials toward a $9.71/bbl discount at the start of Q3, a notable shift from the $7.58 average seen in Q2.The broader heavy crude landscape has been volatile in 2026. TPH said differentials widened in Q1 as additional barrels from Venezuela entered the market, but narrowed in Q2 as regional supplies tightened due to reduced Middle Eastern sour crude shipments.Simultaneously, WCS at Houston has seen its discount to Brent narrow significantly to $7.52 in June, down from $15.12 recorded in May.Market participants attribute this tightness in Canadian heavy crude to supply-side constraints at the source. TPH said unfavorable wet weather in Canada has hindered oil sands operations, compounded by an unplanned outage at Cenovus Energy's (CVE) Foster Creek and Christina Lake assets.The bank said the shifting dynamics in heavy crude pricing carry significant implications for Gulf Coast refiners, specifically Valero Energy (VLO), PBF Energy (PBF), Phillips 66 (PSX), and Marathon Petroleum (MPC).Price: $25.68, Change: $+0.52, Percent Change: +2.05%

$CVE$MPC$PBF$PSX$VLO
Equities

Morgan Stanley Adjusts Price Target on Valero Energy to $255 From $232

Valero Energy (VLO) has an average rating of overweight and mean price target of $265.67, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

$VLO
Commodities

Supply Disruptions Lift Refiner Q2 EPS Outlook Above Consensus, TPH Energy Says

TPH raised its average second-quarter 2026 earnings estimate for refiners to $6.38 per share from $5.67, exceeding the $5.40 consensus forecast and sharply above Q1 earnings of $0.59 per share, the firm said Thursday.TPH said supply disruptions tied to the US-Iran conflict continue to support refining fundamentals and improve earnings expectations across the sector.The International Energy Agency expects global refinery runs to fall to 78.7 million barrels per day in the second quarter from 83.6 million b/d in Q1 and 82.9 million b/d a year earlier, TPH said.TPH said shipping disruptions in the Strait of Hormuz and refinery damage linked to the conflict are reducing global fuel supplies.US gasoline cracks increased by about $20 per barrel over the quarter to $25/bbl, compared with a five-year average of $20/bbl, the firm said.US diesel cracks climbed by roughly $21/bbl to $48/bbl, more than double the five-year average of $22/bbl, TPH said.The West Coast, Southwest and Rocky Mountain regions posted the strongest margin gains relative to historical averages, while the Mid-Continent and Midwest regions lagged, according to the firm.US refiners increased operating rates to address supply shortages, pushing utilization to 91% in the second quarter from a five-year average of 89%, TPH said.Higher operating rates helped gasoline exports reach 880,000 b/d and distillate exports rise to 1.56 million b/d, above five-year averages of 828,000 b/d and 1.19 million b/d, respectively, the firm said.TPH said tighter availability of Middle Eastern medium-sour crude has narrowed crude differentials, although Western Canadian Select prices at Hardisty and Houston remain under pressure from constrained Canadian pipeline capacity.The firm added that stronger backwardation is creating a $ 5/bbl-over-the-quarter headwind for inland US crude barrels, while elevated tanker costs are weighing on coastal markets.TPH expects lower crude prices, wider West Coast jet fuel premiums, reduced downtime and a $4/bbl increase in octane spreads to support second-quarter capture rates.However, the firm said rising Renewable Volume Obligation costs approaching $4/bbl, tighter crude differentials, weaker butane blending demand and the $5/bbl WTI structure impact remain key challenges.TPH forecast group capture rates of 73% in the second quarter, compared with 72% in the first quarter.The firm said renewable diesel indicators improved by $1.39 per gallon, Midwest ethanol margins increased by $0.33/gal, polyethylene chain margins rose by $0.40 per pound and $0.32/lb, while UAN and ammonia fertilizer prices advanced 33% and 27%, respectively.TPH said potential Small Refinery Exemption proceeds could equal 23% of market capitalization for Delek US Holdings (DK), 7% for Par Pacific Holdings (PARR), and 4% each for HF Sinclair (DINO) and CVR Energy (CVI), assuming partial waivers for all applications.TPH said its second-quarter earnings forecasts exceed consensus estimates for Par Pacific Holdings, HF Sinclair, Phillips 66 (PSX) and Valero Energy (VLO), while its estimate for CVR Energy remains below consensus.Price: $47.19, Change: $+0.01, Percent Change: +0.02%

$CVI$DINO$DK$PARR$PSX$VLO
Wire

Phillips 66, HF Sinclair Lead Refining Margin Recovery in Q2, TPH Energy Says

Phillips 66 (PSX) posted the largest month-over-month refining indicator increase in May, while HF Sinclair Corporation (DINO) delivered the greatest improvement in Q2, TPH Energy said Monday.Stronger gasoline cracks across the North Atlantic, Mid-Continent and Gulf Coast regions lifted Valero Energy's (VLO) refining indicator to $33.70 per barrel in May from $28.97/bbl in April, according to TPH.While diesel cracks and crude differentials produced mixed results, wider West Texas Intermediate, Louisiana Light Sweet and Argus Sour Crude Index spreads helped push Valero's Q2 refining indicator $13.50/bbl above Q1 levels, TPH said.Valero's ethanol indicator increased to $0.66 per gallon in May from $0.65/gal in April and now stands $0.16/gal higher over the quarter, according to TPH.Despite a decline to $1.07/gal from $1.22/gal in April as feedstock costs rose, Valero's renewable diesel indicator remains $0.15/gal above Q1 levels, TPH said.Support from lower crude prices in the Central Corridor and narrower Dated Brent spreads in the Atlantic Basin helped lift Phillips 66's refining indicator to $29.45/bbl in May from $17.92/bbl in April, according to TPH.Although Phillips 66's renewable diesel indicator eased to $2.07/gal from $2.30/gal in April, the metric remains $1.32/gal higher quarter over quarter, TPH said.Marathon Petroleum (MPC) increased its refining and marketing indicator to $35.88/bbl in May from $33.02/bbl in April as Mid-Continent margins improved $15.10/bbl and Gulf Coast margins advanced $6.56/bbl month over month, according to TPH.West Coast margins declined $0.59/bbl month over month, while narrower sweet and sour crude differentials and weaker backwardation weighed on results, with the Q2 indicator standing $16.53/bbl above Q1 levels, TPH said.HF Sinclair increased its renewable volume obligation-adjusted refining indicator to $33.81/bbl in May from $27.35/bbl in April as stronger Mid-Continent and West Coast margins lifted the metric, bringing its Q2 improvement to $18.85/bbl quarter over quarter, TPH said.TPH said HF Sinclair's lubricants business continued to strengthen, with Group I-III margins averaging $108.78/bbl above Q1 levels in Q2, while its renewable diesel indicator remains up $0.69/gal quarter over quarter despite a $0.04/gal decline in May, and wider Western Canadian Select differentials could provide additional upside.Price: $182.20, Change: $+1.95, Percent Change: +1.08%

$DINO$MPC$PSX$VLO
Commodities

Market Chatter: Trump's Fuel Shipping Exemptions Had Limited Impact on US Gasoline Prices

President Donald Trump's Jones Act waiver allowing fuel and crude barrels to be moved between US ports had a limited impact on high domestic gasoline prices amid higher freight rates and smaller shipment volumes, according to a Reuters analysis on Wednesday.In March, President Donald Trump eased restrictions under the century-old Jones Act, allowing foreign-flagged ships to transport crude and fuel between domestic ports to support coastal fuel supplies.The waiver aimed to increase shipments from Gulf Coast refiners to East and West Coast markets, where refinery shortages and limited pipeline access continue to tighten fuel availability.National gasoline prices climbed to $4.49 per gallon Tuesday from below $3 before the Iran conflict erupted in late February, while California averaged $6.11 per gallon, the analysis added, citing American Automobile Association data.According to the White House, data compiled since the first Jones Act waiver was granted indicate that more supply could reach US ports more quickly. Administration officials are reportedly happy with the waiver's results and have conveyed to the oil industry that future extensions may be granted, sources told Reuters.Federal figures showed Valero (VLO) and Phillips 66 (PSX) used the exemptions about 50 times during the first two months, transporting 2.6 million barrels of crude alongside 7.5 million barrels of refined fuels.Because disruptions around the Strait of Hormuz pushed tanker rates sharply higher, the waiver delivered only modest shipping savings while transported volumes remained small compared with nationwide fuel demand.University of Chicago energy policy professor Ryan Kellogg said that unusually high freight costs and a shortage of available international tankers made it difficult to secure vessels.American Maritime Partnership President Jennifer Carpenter said the waiver failed to "lower prices at the pump, and materially increase the flow of product across the country."White House officials viewed the waiver positively after additional fuel cargoes reached domestic ports faster, while administration sources signaled openness to extending the measure if needed, according to the analysis.Over 60% of gasoline and blendstock shipments transported under the waiver were delivered to California, totaling roughly 3 million barrels, or about 2.1 million gallons per day, federal data showed.Shipments into California, Alaska, Florida, South Carolina and Oregon combined averaged approximately 84,000 barrels daily, compared with total US fuel consumption near 8.75 million barrels per day, the analysis added.Argus data showed that foreign-flagged vessels moving fuel from the US Gulf Coast to the West Coast could reduce shipping costs by about 6.6 cents per gallon, or nearly 1% of California gasoline prices, while Jones Act tankers remained cheaper on East Coast routes due to strong Asian vessel demand.The waiver also altered shipping patterns, with one US tanker carrying Alaskan crude to South Korea in April for its first international voyage since 2014, while industry sources warned that foreign competition on domestic routes could tighten US tanker availability further.(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

$PSX$VLO
Equities

Mizuho Adjusts Price Target on Valero Energy to $289 From $222, Maintains Neutral Rating

Valero Energy (VLO) has an average rating of overweight and mean price target of $260.11, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

$VLO
Commodities

Refiners Slide as US-Iran Peace Hopes Pressure Crack Spreads, TPH Energy Says

Refining equities and product crack spreads declined last week as reports of progress in US-Iran peace negotiations pressured margins and softened sector sentiment, TPH Energy strategists said in a note on Tuesday.Matthew Blair, analyst at TPH Energy, said the refining group fell 1.3%, underperforming the S&P 500's 0.9% gain, with high-beta names leading losses.PBF Energy (PBF) dropped 4.9%, while Phillips 66 (PSX) outperformed the group with a 1.6% rise, making it the lone notable gainer among diversified refiners.TPH said the decline was driven by a sharp compression in refined product cracks. US gasoline cracks fell $12 to $25 per barrel, while US diesel cracks declined $7 to $45/bbl.Regional softness was most pronounced in the Midwest, Midcontinent and Rockies, TPH analysts said, reflecting broad-based margin pressure.International cracks were mixed. Northwest Europe gasoline and diesel eased by $1 and $3/bbl, respectively, while Singapore markets moved against the trend, with gasoline up $3/bbl and diesel rising $5/bbl.Forward curves also reflected the softer tone. The 2026 gasoline strip moved $1 lower, while diesel was unchanged.On the crude side, the Brent-WTI spread narrowed to $3/bbl from $5 previously, reducing a key advantage for US refiners that benefit from discounted domestic crude.Blair said grades, including Mars, Louisiana Light Sweet and Bakken crude strengthened, while Western Canadian Select at Hardisty, Mexico's Maya crude and Alaska North Slope held largely steady.Macro and industry developments added to the mixed backdrop. US regular gasoline prices eased 5 cents to $4.45 per gallon. India raised retail gasoline prices in response to war-related supply dynamics involving Iran.Kuwait's refinery throughput has reportedly fallen by half since the Middle East conflict began, while US jet fuel production has climbed above 2 million barrels per day in recent weeks.On corporate activity, Delek US Holdings (DK) disclosed a $100 million share repurchase authorization from REH. However, despite the recent pullback in refining equities, TPH said most refiners continue to trade above their three-year average forward EBITDA valuation multiples, except for Phillips 66 and Valero Energy (VLO).

$DK$PBF$PSX$VLO
Equities

Jefferies Adjusts Price Target on Valero Energy to $284 From $290, Maintains Buy Rating

Valero Energy (VLO) has an average rating of overweight and mean price target of $260.11, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)

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