Refiner Phillips 66 reports Q3 profit beat on midstream, chemicals strength

(Reuters) -Phillips 66 beat quarterly profit estimates on Tuesday as strength in its chemicals and midstream segments helped the refiner more than offset a slump in refining margins from lackluster fuel demand.

The company, which owns nearly 72,000 miles of U.S. pipeline systems, has moved more fuel this year than before through its pipelines as it expands its natural gas liquids market share.

Volumes of the super-chilled fuel that moved through its pipelines rose to 2.79 million barrels per day in the first nine months of 2024, compared to 2.70 million bpd in 2023.

The company said its third-quarter adjusted profit rose 15.6% from a year earlier.

Its chemicals segment reported an adjusted profit of $342 million, up from $104 million a year earlier.

However, its refining segment was hit by a drop in realized margins driven by lower crack spreads. Margins fell to $8.31 per barrel in the quarter from $19.06 a barrel.

U.S. refinery margins, measured by the 3-2-1 crack spread, dipped to $14.28 in mid-September, the lowest since early 2021.

Globally, refiners have seen a drop in profitability on soft consumer and industrial demand, especially in China, because of slowing economic growth and rising penetration of electric vehicles.

British energy giant BP (NYSE:BP ) earlier today reported a fall in third-quarter profit on weaker refining margins.

Rival Valero last week also reported a fall in third-quarter profit, but managed to beat earnings estimates.



Phillips 66 (NYSE:PSX )'s third-quarter adjusted profit came in at $2.04 per share, well above analysts' average estimate of $1.66, according to data compiled by LSEG.

It also managed to return $1.3 billion to shareholders through dividends and share repurchases in the quarter.

Source: Investing.com