US Sunoco reports Q1 $59m net loss

30 April 2008 23:33  [Source: ICIS news]

HOUSTON (ICIS news)--US base-oils producer Sunoco reported on Wednesday a first-quarter net loss of $59m (€38m) as a result weaker refined product margins.

Sunoco's results were down substantially from a $175m net income that it reported for the same time last year.

"The first-quarter market environment was clearly a challenging one for Sunoco and the refining industry," said John Drosdick, Sunoco chief executive. "The loss in refining and supply was primarily the result of weakness in refined product margins, especially for gasoline, which were compressed by the combination of higher crude oil costs and lower product demand."

The company's refining and supply segment reported a loss of $123m for the quarter, compared with earnings of $76m for the same time last year, Sunoco said. While the segment reported higher production volumes, those were unable to offset lower margins and higher expenses.

Sunoco attributed the lower margins to higher crude costs and lower product demand. Realised wholesale margins were $3.43/bbl, down from $6.98/bbl for the same time last year.

At the same time, expenses rose as a result of higher prices for purchased fuel, Sunoco said.

Although Sunoco produces base oils, its main products are gasoline and middle distillates. The company produced 393,500 bbl/day of gasoline and 298,600 bbl/day of middle distillates in the first quarter.

Lubricant production totalled 12,200 bbl for the quarter, Sunoco said.

($1 = €0.64)

By: Al Greenwood
+1 713 525 2653

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