If you're lying to your friends and stealing from your kids, you might just be addicted to crack. If you're cutting back production and reducing capital spending, well then you could have a crack spread problem.
Excluding that 800-pound gorilla, Valero battled through weakening demand and tight gasoline crack spreads to actually beat earnings estimates by more than 50%. The adjusted net income of $732 million beat the prior year's result by 29%. With respect to operations, the company is to be commended for remaining profitable during such a tumultuous period.
Unfortunately, demand continues to deteriorate rapidly, prompting a spate of refinery closures by Valero and competitors Conoco Phillips
Valero's cash position deteriorated notably during 2008 to less than $1 billion, but I still find Western Refining
I continue to view Valero as one of the very best players in the refining space, but the operating environment has grown so severe that I caution Fools from entering the sector just now. While I feel a tinge of buyer's remorse over my purchase of Valero shares many moons ago, at least I may be in good company as Warren Buffett waits for Berkshire Hathaway's