What does the future hold for mid-continent refiners? In this video, Motley Fool energy analyst Joel South describes the issues facing refiners today. First, the EPA recently announced possible limits on sulfur content in gasoline, which would increase gasoline production costs. Also ethanol Renewable Identification Numbers are becoming more expensive, further pressuring profit margins. Next, the WTI-Brent crude spread has now declined to about $12. This lowers mid-continent refiners' competitive advantage over coastal refineries. However, this spread was not uncommon in the past and may not be that big of a problem, especially as oil drops below $90 per barrel. Lastly, the export market remains strong: Exports to Central and South America, Europe, and even Asia can give refiners a boost in revenue.
You're reading a free article with opinions that may differ from The Motley Fool's Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More
The Future of Mid-Continent Refiners
NYSE: HFC
HollyFrontier

Is the incredible run for U.S. refiners over?
Joel South has no position in any stocks mentioned. Taylor Muckerman has no position in any stocks mentioned. The Motley Fool owns shares of Western Refining. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Stocks Mentioned




*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.
Related Articles





Premium Investing Services
Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.