Business Emerge, July 25: Valero Energy, headquartered in San Antonio, Texas, announced a decline in second-quarter profits, significantly impacted by weaker refining margins and a notable increase in global refining capacity. The company’s net income for the three months ending June 30th fell to $880 million, or $2.71 per share, compared to $1.94 billion, or $5.40 per share, in the same period last year.
Energy giants had previously indicated that weak fuel prices would negatively affect their quarterly earnings. This trend was evident in Valero’s performance, with refining margins falling to $3.05 billion in the second quarter, down from $4.22 billion the previous year.
Refiners had increased their processing capacity to 93.5% in the second quarter, up from 91% in the previous year, in anticipation of higher demand which ultimately did not materialize. This information, provided by the Energy Information Administration, underscores the challenges faced by the industry in aligning supply with fluctuating market demand.