Where your diesel dollar goes: the refiner’s slice of a gallon has roughly tripled in a year. Valero reports Thursday, and Wall Street expects about $21 a share.
By Energy News Beat | Monday, Oct. 19, 2026 | Prices as of 6:28 a.m. CT unless noted
If you topped off a 30-gallon diesel pickup this morning, you paid about $80 more than you would have a year ago. AAA puts the national average for diesel at $6.32 a gallon (as of 6:28 a.m. CT Monday), against $3.63 on this date last year. Regular gasoline is $4.30. (ENB calculation: 30 gallons times the $2.69 difference.)
Part of that money goes to whoever pumped the oil. A growing part goes to the plants that turn it into fuel. On Thursday morning Valero Energy, one of the largest U.S. independent refiners, reports third-quarter results, and analysts expect the best quarter in its history.
What Wall Street expects on Thursday
Valero says its earnings release will come out early on Oct. 22, ahead of a 10 a.m. ET (9 a.m. CT) call. The Zacks consensus is $21.23 a share, which Zacks says is 480.1% above the year-ago number. That year-ago number was an adjusted $3.66.
On Oct. 6, UBS raised its estimate to $20.00 from $14.16 and lifted its price target to $467. “This would be a new quarterly earnings record for VLO, beating prior high of $12.62 in 2Q26,” the UBS analyst wrote, as quoted by StreetInsider. UBS models $3.3 billion of share buybacks for the quarter. For comparison, Valero’s second-quarter release shows $12.62 a share as reported ($12.54 adjusted) and $2.6 billion returned to stockholders.
These are still estimates. Zacks’ own model (Earnings ESP of -0.32%) does not flag a likely beat, though Valero has beaten consensus four quarters running. Also this week and next: oilfield-services company Halliburton on Tuesday, Oct. 20 (8 a.m. CT call), and refiners Phillips 66 on Oct. 28, PBF Energy on Oct. 29 and Marathon Petroleum on Nov. 3.
Where your diesel dollar goes
EIA’s official “What we pay for” breakdown is a monthly series, and its latest month is May 2026. In May, a $5.60 gallon of diesel was 42% crude oil, 25% refining, 23% distribution and marketing, and 11% taxes. ENB rebuilt the split for the week of Oct. 12 from EIA’s retail price, daily spot prices and fuel-tax table (Chart 1).
EIA’s retail diesel average that week was $6.18. About $2.35 of it was crude oil (WTI at Cushing). About $2.31 was the refining spread, meaning the Gulf Coast diesel spot price minus WTI. Taxes took about $0.60, and distribution and marketing about $0.91. A year earlier the refining slice was just $0.72, against $1.42 for crude.
Of the roughly $2.51 rise in the pump price, about $1.59 (63%) came from the refining slice and about $0.93 from crude (ENB calculation). The refiner’s cut is now almost as big as the oil itself. That is what a “tight” product market means for your wallet.
Why refiners are getting paid
What the world is short of is fuel more than crude. The IEA’s October Oil Market Report says refined-product shipments from the Middle East are still “below half of their pre-war levels.” It also says global diesel exports in September were 700,000 barrels a day lower than a year earlier, and that “discounted feedstocks propelled US margins to new highs.”
EIA’s weekly report for the week ending Oct. 9 shows U.S. distillate stocks at 102.6 million barrels. That is 12.2% below the 2021–2025 average for the same week, below the bottom of that five-year range, and the lowest for this time of year in EIA weekly data going back to 1982 (ENB calculation). Refineries ran at 93.5% of capacity nationally and 96.3% on the Gulf Coast (EIA Table 9).
ENB’s Gulf Coast 3-2-1 crack spread, built from EIA spot prices, averaged $69.66 a barrel in the third quarter. That compares with $47.11 in the second quarter and $24.78 a year earlier. The September average of $75.59 was the highest month in the series, which starts in 2006 (Chart 2). Valero ran about 2.95 million barrels a day in the second quarter, so each $1 a barrel of margin is worth roughly $270 million a quarter before costs and taxes (ENB calculation).
Valero isn’t alone: ExxonMobil said higher refining margins added about $4.5 billion to its third quarter (Bloomberg via Energy Connects; ENB coverage).
The Hormuz risk: margins can fall faster than they rose
Gulf News reports that Iranian Foreign Minister Abbas Araghchi says Tehran’s offer to reopen the Strait of Hormuz within seven days is “still on the table.” The offer depends on the U.S. lifting its blockade and sanctions and ending hostilities, and Iran says it is still reviewing U.S. comments. No deal has been reached.
If a deal happens, missing fuel starts moving again, and refiners would feel it quickly. The IEA notes that European diesel cracks fell from about $100 a barrel to “close to $60” by early October once freight and crude costs jumped. ENB’s Gulf Coast crack is already about 13% lower so far in October ($65.68) than its September average. The IEA expects the diesel market to swing to a surplus in the first quarter of 2027, while staying tight “well into 2027.” What Valero says about the fourth quarter may matter more than its third-quarter results, record or not.
Caveats and criticism
- ENB’s split is an estimate. Spot and pump prices move on different schedules, Gulf Coast spot is not the national rack price, and Valero runs a lot of discounted heavy crude rather than WTI. Its own refining margin was $23.62 per barrel of throughput in the second quarter (Q2 release), well below the screen crack spread, so the company keeps less than the headline margin.
- Refiners do not set crude prices. High margins are how the market pays refineries to run harder and send fuel where it is short. According to The Guardian, U.S. fuel exports hit an all-time high of 1.9 million barrels a day this summer.
- Critics see profiteering. “Meanwhile, oil executives pad their profits while working families struggle,” said Todd Spencer, president of the Owner-Operator Independent Drivers Association (Truckers News). TotalEnergies chief executive Patrick Pouyanné was quoted saying “I prefer the world of disruption to the peaceful world” (The Guardian).
- Estimates go stale quickly. UBS’s Oct. 6 note cited a Street estimate of $18.34. The Zacks consensus was $21.23 ten days later. The $12.62 “prior high” is reported EPS. On the adjusted basis that consensus uses, the second quarter was $12.54.
- Refining capacity is shrinking.S. operable capacity is 18.04 million barrels a day, down from 18.16 a year ago, and the West Coast lost about 281,000 barrels a day (EIA Table 9). New refineries take years to build.
How consumers and investors see it
Consumers and truckers: “Every $1 increase per gallon in fuel costs our members around $400 more per week, and sustained high prices will put many truck drivers out of business,” OOIDA’s Spencer said (Truckers News). GasBuddy’s Patrick De Haan said this week that gasoline prices fell in most states “while diesel rose in most states” (WKYC). The IEA warns that “record diesel prices are already having broad economic consequences by raising the cost of goods and impacting real incomes.”
Investors: Valero closed at $444.71 on Oct. 16 (StockAnalysis); UBS’s $467 target is about 5% above that (ENB calculation). UBS argues “the global market is likely to view the U.S. as a more reliable and strategically important source of refined products.” Zacks rates Valero #1 (Strong Buy) but also calls it “relatively overvalued” at 9.4 times trailing EV/EBITDA, compared with an industry average of 6.48. The Guardian reports that Marathon, Valero and Phillips 66 together have added $215 billion in market value this year.
| Stu’s Take (opinion)
Valero isn’t the villain here. The villain is a world that stopped building refineries. With diesel at $6.32 and the refining slice of a gallon at about $2.31, the market is begging for more refining. Instead, U.S. operable capacity is 18.04 million barrels a day, down from 18.16 a year ago. There are only two ways to lower fuel prices: demand destruction or building more refineries. Demand destruction is already here. The IEA sees world oil demand down 2.6 million barrels a day this year, with diesel making up 25% of the drop. That pain shows up as truckers paying about $400 more a week for every $1 a gallon. I would rather we build. A Hormuz deal would help your wallet fast, and refiners’ margins would come down hard. Europe’s diesel cracks went from about $100 to near $60 by early October. Record refining profits are the symptom. More refining capacity is the cure. — Stuart Turley, host of the Energy News Beat podcast. This box is opinion. |
More on ENB: IEA says the diesel squeeze lasts well into 2027; Should the Defense Production Act be used to expand refineries?; Two Russia waivers in a week, and no drop at the diesel pump.
What ENB could not confirm: whether Valero actually posts a record, the full UBS note, Valero’s real third-quarter buybacks and margin capture, and whether a Hormuz deal is close. Details are in the appendix.
Appendix: Make Appendices Great Again
All times Central (CT). Fast-moving prices carry as-of times. “ENB calculation” marks Energy News Beat’s own arithmetic from the cited data.
A. Full source list
| # | Source | Perspective | Link | Accessed |
| 1 | AAA national average gas and diesel prices | Primary: price survey (consumer group) | https://gasprices.aaa.com/ | Oct. 19, 2026 |
| 2 | AAA news release, “Gas Prices Not Budging Much as Crude Oil Remains High,” Oct. 15, 2026 | Primary: consumer group | https://gasprices.aaa.com/gas-prices-not-budging-much-as-crude-oil-remains-high/ | Oct. 19, 2026 |
| 3 | Valero: Q3 2026 earnings date announcement, Sept. 8, 2026 | Primary: company IR | https://investorvalero.com/news/news-details/2026/Valero-Energy-Corporation-to-Announce-Third-Quarter-2026-Earnings-Results-on-October-22-2026/default.aspx | Oct. 19, 2026 |
| 4 | Valero Q2 2026 earnings release (SEC Form 8-K Exhibit 99.01), July 30, 2026 | Primary: company filing (SEC) | https://www.sec.gov/Archives/edgar/data/1035002/000162828026050822/a6302026exh9901earningsrel.htm | Oct. 19, 2026 |
| 5 | Valero Form 10-Q for quarter ended June 30, 2026 | Primary: company filing (SEC) | https://www.sec.gov/Archives/edgar/data/1035002/000162828026050937/vlo-20260630.htm | Oct. 19, 2026 |
| 6 | Valero Q3 2025 earnings release (SEC Exhibit 99.01), Oct. 23, 2025 | Primary: company filing (SEC) | https://www.sec.gov/Archives/edgar/data/1035002/000162828025045978/a9302025exh9901earningsrel.htm | Oct. 19, 2026 |
| 7 | Valero Q4 and full-year 2025 results, Jan. 29, 2026 | Primary: company IR | https://investorvalero.com/news/news-details/2026/Valero-Energy-Reports-2025-Fourth-Quarter-and-Full-Year-Results/default.aspx | Oct. 19, 2026 |
| 8 | SEC XBRL company concept API: Valero diluted EPS | Primary: SEC data | https://data.sec.gov/api/xbrl/companyconcept/CIK0001035002/us-gaap/EarningsPerShareDiluted.json | Oct. 19, 2026 |
| 9 | EIA Gasoline and Diesel Fuel Update (incl. “What we pay for”), released Oct. 14, 2026 | Primary: U.S. government statistics | https://www.eia.gov/petroleum/gasdiesel/ | Oct. 19, 2026 |
| 10 | EIA Weekly Petroleum Status Report, week ending Oct. 9, 2026 (released Oct. 15) | Primary: U.S. government statistics | https://www.eia.gov/petroleum/supply/weekly/ | Oct. 19, 2026 |
| 11 | EIA WPSR Table 1 (stocks) CSV | Primary: U.S. government statistics | https://ir.eia.gov/wpsr/table1.csv | Oct. 19, 2026 |
| 12 | EIA WPSR Table 9 (refinery inputs, capacity, utilization) CSV | Primary: U.S. government statistics | https://ir.eia.gov/wpsr/table9.csv | Oct. 19, 2026 |
| 13 | EIA weekly U.S. distillate stocks history (WDISTUS1) | Primary: U.S. government statistics | https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WDISTUS1&f=W | Oct. 19, 2026 |
| 14 | EIA weekly refinery utilization history (WPULEUS3) | Primary: U.S. government statistics | https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WPULEUS3&f=W | Oct. 19, 2026 |
| 15 | EIA daily spot prices (WTI, Brent, Gulf Coast gasoline and ULSD) | Primary: U.S. government statistics | https://www.eia.gov/dnav/pet/pet_pri_spt_s1_d.htm | Oct. 19, 2026 |
| 16 | EIA federal and state motor fuel taxes (July 2026 revised) | Primary: U.S. government statistics | https://www.eia.gov/petroleum/marketing/monthly/xls/fueltaxes.xlsx | Oct. 19, 2026 |
| 17 | IEA Oil Market Report, October 2026 (Oct. 14) | Primary: intergovernmental agency | https://www.iea.org/reports/oil-market-report-october-2026 | Oct. 19, 2026 |
| 18 | Zacks via Yahoo Finance, “Valero Energy Gears Up to Report Q3 Earnings,” Oct. 16, 2026 | Analyst/research (sell-side style) | https://finance.yahoo.com/energy/articles/valero-energy-gears-report-q3-152600003.html | Oct. 19, 2026 |
| 19 | StreetInsider, “Valero Energy (VLO) PT Raised to $467 at UBS,” Oct. 6, 2026 | Analyst (UBS note excerpt, via news site) | https://www.streetinsider.com/Analyst+Comments/Valero+Energy+%28VLO%29+PT+Raised+to+%24467+at+UBS+Into+Q3+Earnings/27153284.html | Oct. 19, 2026 |
| 20 | Halliburton Q3 2026 call announcement | Primary: company IR | https://ir.halliburton.com/news-releases/news-release-details/halliburton-third-quarter-2026-earnings-conference-call | Oct. 19, 2026 |
| 21 | Phillips 66 Q3 2026 results announcement | Primary: company IR | https://investor.phillips66.com/financial-information/news-releases/news-release-details/2026/Phillips-66-to-announce-third-quarter-financial-results/default.aspx | Oct. 19, 2026 |
| 22 | PBF Energy Q3 2026 results announcement | Primary: company IR | https://investors.pbfenergy.com/news/news-details/2026/PBF-Energy-to-Release-Third-Quarter-2026-Earnings-Results/default.aspx | Oct. 19, 2026 |
| 23 | Marathon Petroleum Q3 2026 results announcement | Primary: company IR | https://ir.marathonpetroleum.com/investor/news-releases/news-details/2026/Marathon-Petroleum-Corp–to-Report-Third-Quarter-Financial-Results-on-November-3-2026/default.aspx | Oct. 19, 2026 |
| 24 | Reuters via Business Recorder, oil prices, Oct. 19, 2026 | News: wire service | https://www.brecorder.com/news/40444883 | Oct. 19, 2026 |
| 25 | Gulf News, Hormuz deal unresolved, Oct. 19, 2026 | News: regional outlet | https://gulfnews.com/world/mena/us-israel-iran-war-hormuz-deal-unresolved-us-renews-warning-to-americans-1.500715439 | Oct. 19, 2026 |
| 26 | Bloomberg via Energy Connects, ExxonMobil refining earnings, Oct. 16, 2026 | News: wire service | https://www.energyconnects.com/news/gas-lng/2026/october/exxon-signals-record-refining-earnings-as-diesel-prices-soar/ | Oct. 19, 2026 |
| 27 | The Guardian, refiners and record profits, Oct. 14, 2026 | News: national newspaper (UK) | https://www.theguardian.com/business/2026/oct/14/refineries-record-profits-diesel-shortage-fuel-crude-oil | Oct. 19, 2026 |
| 28 | Truckers News, OOIDA statement on red-dyed diesel order, Oct. 6, 2026 | Trade press quoting trade association (truckers) | https://www.truckersnews.com/home/article/15836752/trumps-order-allows-truckers-to-use-reddyed-diesel-ooida-calls-it-minimal-relief-take-our-poll | Oct. 19, 2026 |
| 29 | WKYC, GasBuddy weekly report, Oct. 19, 2026 | Local news quoting price-tracking firm | https://www.wkyc.com/article/traffic/gas-prices/gas-prices-go-up-akron-cleveland-gasbuddy-report-northeast-ohio/95-7c404a4f-312e-4097-8597-53b4a90ecaa6 | Oct. 19, 2026 |
| 30 | StockAnalysis, VLO price history | Market data aggregator | https://stockanalysis.com/stocks/vlo/history/ | Oct. 19, 2026 |
| 31 | ENB: ExxonMobil signals soaring refining earnings | ENB internal (verified HTTP 200) | https://energynewsbeat.co/earnings/exxonmobil-signals-soaring-refining-earnings-as-downstream-boom-offsets-upstream-pressure/ | Oct. 19, 2026 |
| 32 | ENB: IEA says the diesel squeeze lasts well into 2027 | ENB internal (verified HTTP 200) | https://energynewsbeat.co/diesel/iea-says-the-diesel-squeeze-lasts-well-into-2027-futures-imply-about-6-diesel-into-january/ | Oct. 19, 2026 |
| 33 | ENB: Defense Production Act and refinery expansion | ENB internal (verified HTTP 200) | https://energynewsbeat.co/big-oil-companies/should-the-trump-administration-use-the-defense-production-act-to-expand-refineries-and-pipelines/ | Oct. 19, 2026 |
| 34 | ENB: Two Russia waivers in a week, no drop at the diesel pump | ENB internal (verified HTTP 200) | https://energynewsbeat.co/diesel/two-russia-waivers-in-a-week-and-no-drop-at-the-diesel-pump/ | Oct. 19, 2026 |
B. Key excerpts from primary documents
Valero Q2 2026 earnings release (SEC)
“Valero Energy Corporation … today reported net income attributable to Valero stockholders of $3.7 billion, or $12.62 per share, for the second quarter of 2026, compared to $714 million, or $2.28 per share, for the second quarter of 2025. … adjusted net income attributable to Valero stockholders for the second quarter of 2026 was $3.7 billion, or $12.54 per share.” Also: “Valero stockholder cash returns totaled $2.6 billion in the second quarter of 2026.” Market reference table: U.S. Gulf Coast ULS diesel less Brent $43.52/bbl (Q2 2026) vs. $14.79 (Q2 2025); refining margin per barrel of throughput $23.62.
Valero earnings-date release, Sept. 8, 2026
“…will host a conference call on Thursday, October 22, 2026, at 10:00 a.m. ET to discuss its financial and operational results for the third quarter of 2026. The earnings release will be issued earlier that morning.”
IEA Oil Market Report, Oct. 14, 2026
“Record freight and crude costs crushed margins in Europe and Asia, while discounted feedstocks propelled US margins to new highs.” … “Refined product and LPG shipments from the Middle East … remain below half of their pre-war levels.” … “diesel cracks for European refiners dropped back from $100/bbl to close to $60/bbl by early October.” … “Higher global refinery output will return the gasoil/diesel market to a surplus in 1Q27 … the gasoil market balance will remain tight well into 2027.”
EIA Gasoline and Diesel Fuel Update, Oct. 14, 2026
“What we pay for in a gallon of … Diesel, May 2026, Retail price: $5.60/gallon”: Taxes 11%, Distribution & Marketing 23%, Refining 25%, Crude Oil 42%. U.S. on-highway diesel: $6.179 (Oct. 12, 2026), $2.514 above a year ago.
EIA WPSR Table 1 and Table 9, week ending Oct. 9, 2026
Distillate fuel oil stocks 102.611 million barrels (vs. 105.138 prior week; 117.030 a year ago). Percent utilization 93.5% (Gulf Coast 96.3%). Operable capacity 18,044 thousand b/d (vs. 18,160 a year ago); West Coast 2,277 (vs. 2,558).
UBS via StreetInsider, Oct. 6, 2026
“We are adjusting our 3Q26 EPS estimate to $20.00 ($14.16. prior) vs. Street of $18.34. … We are modeling buybacks of $3,300M for the quarter (VLO could surprise to the upside). … This would be a new quarterly earnings record for VLO, beating prior high of $12.62 in 2Q26.”
Zacks via Yahoo Finance, Oct. 16, 2026
“The Zacks Consensus Estimate for third-quarter earnings is pegged at $21.23 per share, implying a 480.1% surge from the year-ago reported number.” … “The company has an Earnings ESP of -0.32% and it currently sports a Zacks Rank #1.” … “VLO appears relatively overvalued, at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 9.4X, above the broader industry average of 6.48X.”
Gulf News, Oct. 19, 2026
“Iranian Foreign Minister Abbas Araghchi said that Tehran’s proposal to reopen the strategic waterway within seven days was ‘still on the table’.” … “neither a comprehensive settlement nor an unrestricted reopening of Hormuz is established as of early October 19, 2026.”
OOIDA (Todd Spencer) via Truckers News, Oct. 6, 2026
“Truckers are feeling the pain at the pump. Every $1 increase per gallon in fuel costs our members around $400 more per week, and sustained high prices will put many truck drivers out of business. Meanwhile, oil executives pad their profits while working families struggle.”
C. Data tables
C1. AAA national averages (first checked 6:12 a.m. CT, re-checked unchanged at 6:28 a.m. CT, Oct. 19, 2026; page states “Price as of 10/19/26”)
| Regular | Mid-grade | Premium | Diesel | E85 | |
| Current | $4.2953 | $4.7999 | $5.1985 | $6.3187 | $3.3123 |
| Yesterday | $4.2988 | $4.8151 | $5.2049 | $6.3224 | $3.3168 |
| Week ago | $4.3556 | $4.8488 | $5.2462 | $6.2665 | $3.3340 |
| Month ago | $4.4759 | $4.9700 | $5.3597 | $6.4866 | $3.4691 |
| Year ago | $3.0362 | $3.5327 | $3.8922 | $3.6308 | $2.4125 |
| Record (date) | $5.0165 (6/14/22) | $6.5276 (9/22/26) |
Source: AAA.
C2. Market prices
| Item | Value | As of | Source |
| Brent crude futures | $107.57/bbl (-$2.29, -2.08%) | 1:19 a.m. CT Oct. 19 (0619 GMT) | Reuters via Business Recorder |
| WTI crude futures | $99.46/bbl (-$1.95, -1.92%) | 1:19 a.m. CT Oct. 19 | Reuters via Business Recorder |
| WTI Cushing spot | $101.91/bbl | Oct. 14 (latest EIA daily) | EIA |
| Brent spot (FOB) | $126.55/bbl | Oct. 14 | EIA |
| Gulf Coast ULSD spot | $4.844/gal | Oct. 14 | EIA |
| Gulf Coast conventional gasoline spot | $3.525/gal | Oct. 14 | EIA |
| EIA U.S. on-highway diesel | $6.179/gal | Week of Oct. 12 (released Oct. 14) | EIA |
| EIA U.S. regular gasoline | $4.331/gal | Week of Oct. 12 | EIA |
| VLO close | $444.71 | Oct. 16 close (3 p.m. CT) | StockAnalysis |
| VLO pre-market | $441.60 (-0.70%) | 6 a.m. CT Oct. 19 | StockAnalysis |
C3. ENB diesel price breakdown (ENB calculation)
| Week | Retail | Crude (WTI/42) | Refining spread | Dist. & marketing | Taxes |
| Week of Oct 13, 2025 | $3.665 | $1.423 | $0.718 | $0.927 | $0.597 |
| Week of Oct 12, 2026 | $6.179 | $2.351 | $2.311 | $0.914 | $0.603 |
Inputs: 2025 row uses EIA retail diesel $3.665 (Oct. 13, 2025), Gulf Coast ULSD $2.141 and WTI $59.75 (Oct. 10, 2025), EIA July 2025 average federal+state diesel tax $0.597. 2026 row uses $6.179 (Oct. 12), ULSD $4.662 and WTI $98.73 (Oct. 12), July 2026 tax $0.603. EIA official May 2026 split for comparison: crude 42%, refining 25%, distribution & marketing 23%, taxes 11% of $5.60.
C4. Gulf Coast crack spreads by quarter (ENB calculation, $/bbl)
| Quarter | WTI avg | 3-2-1 crack | Diesel crack | Gasoline crack |
| Q1 2025 | 71.78 | 18.48 | 25.20 | 15.12 |
| Q2 2025 | 64.57 | 21.70 | 23.46 | 20.81 |
| Q3 2025 | 65.78 | 24.78 | 29.96 | 22.19 |
| Q4 2025 | 59.62 | 23.66 | 33.03 | 18.97 |
| Q1 2026 | 72.74 | 31.34 | 44.49 | 24.77 |
| Q2 2026 | 95.65 | 47.11 | 60.13 | 40.60 |
| Q3 2026 | 87.12 | 69.66 | 94.13 | 57.42 |
| Q4 2026 (QTD to Oct. 14) | 98.35 | 65.68 | 97.94 | 49.56 |
Source: EIA daily spot prices. Cracks vs. WTI Cushing; full daily and monthly series are in the Data workbook.
C5. Valero EPS history and estimates
| Quarter | EPS | Basis | Source |
| Q1 2024 | $3.75 | Reported (GAAP) diluted EPS | SEC XBRL (10-Q filed 2025-04-24) |
| Q2 2024 | $2.71 | Reported (GAAP) diluted EPS | SEC XBRL (10-Q filed 2025-07-24) |
| Q3 2024 | $1.14 | Reported (GAAP) diluted EPS | SEC XBRL (10-Q filed 2025-10-23) |
| Q4 2024 | $0.88 | Reported (GAAP) diluted EPS | Valero Q4 2025 release, Jan 29 2026 |
| Q1 2025 | $-1.90 | Reported (GAAP) diluted EPS; includes $1.131B impairment | SEC XBRL (10-Q filed 2026-04-30) |
| Q2 2025 | $2.28 | Reported (GAAP) diluted EPS | SEC XBRL (10-Q filed 2026-07-30) |
| Q3 2025 | $3.53 | Reported (GAAP); adjusted $3.66 | Valero Q3 2025 release, Oct 23 2025 |
| Q4 2025 | $3.73 | Reported (GAAP); adjusted $3.82 | Valero Q4 2025 release, Jan 29 2026 |
| Q1 2026 | $4.22 | Reported (GAAP) diluted EPS | SEC XBRL (10-Q filed 2026-04-30) |
| Q2 2026 | $12.62 | Reported (GAAP); adjusted $12.54 | Valero Q2 2026 release, Jul 30 2026 |
| Q3 2026E (Zacks) | $21.23 | Consensus estimate, as of Oct 16 2026 | Zacks via Yahoo Finance |
| Q3 2026E (UBS) | $20.00 | Analyst estimate, Oct 6 2026 | UBS via StreetInsider |
C6. U.S. distillate stocks vs. five-year range (EIA; range and average are ENB calculation)
| Week ending | 2026 (M bbl) | 5-yr avg | 5-yr low | 5-yr high | vs. avg |
| 2026-08-21 | 103.4 | 120.8 | 111.6 | 138.5 | -14.4% |
| 2026-08-28 | 104.2 | 121.0 | 111.7 | 136.7 | -13.9% |
| 2026-09-04 | 106.3 | 121.9 | 111.8 | 133.6 | -12.8% |
| 2026-09-11 | 107.9 | 124.1 | 116.0 | 131.9 | -13.1% |
| 2026-09-18 | 107.4 | 122.4 | 117.2 | 129.3 | -12.3% |
| 2026-09-25 | 105.2 | 121.9 | 114.4 | 129.7 | -13.7% |
| 2026-10-02 | 105.1 | 119.8 | 110.9 | 129.3 | -12.3% |
| 2026-10-09 | 102.6 | 116.9 | 106.1 | 129.3 | -12.2% |
C7. Refinery utilization and capacity (EIA WPSR Table 9, week ending Oct. 9, 2026)
| Region | Utilization | Operable capacity (kb/d) | Capacity a year ago (kb/d) |
| U.S. | 93.5% | 18,044 | 18,160 |
| East Coast (PADD 1) | 81.1% | 928 | 912 |
| Midwest (PADD 2) | 89.7% | 4,283 | 4,248 |
| Gulf Coast (PADD 3) | 96.3% | 9,903 | 9,799 |
| Rocky Mountain (PADD 4) | 94.6% | 653 | 644 |
| West Coast (PADD 5) | 93.2% | 2,277 | 2,558 |
C8. Earnings calendar (CT)
| Company | Date | Call time (CT) | Source |
| Halliburton (HAL) | Tue., Oct. 20 | 8:00 a.m. | Halliburton IR |
| Valero (VLO) | Thu., Oct. 22 | 9:00 a.m. (release earlier) | Valero IR |
| Phillips 66 (PSX) | Wed., Oct. 28 | 11:00 a.m. (noon ET) | Phillips 66 IR |
| PBF Energy (PBF) | Thu., Oct. 29 | 7:30 a.m. (8:30 ET) | PBF IR |
| Marathon Petroleum (MPC) | Tue., Nov. 3 | 10:00 a.m. (11 a.m. EST) | MPC IR |
D. Background
A refinery’s gross margin is roughly the value of the fuels it makes minus the cost of the crude it buys. The “3-2-1 crack spread” is a standard shorthand: the value of two barrels of gasoline plus one of diesel, divided by three, minus a barrel of crude.
Valero operates 14 refineries in the U.S., Canada and the U.K. with about 3.0 million barrels a day of throughput capacity, plus renewable diesel (Diamond Green Diesel joint venture) and 12 ethanol plants (Q2 release).
According to the IEA, 2026 diesel tightness stems from war damage and export losses in the Middle East and Russia. Middle East product exports are below half of pre-war levels, and September diesel exports from Russia and the Middle East combined were 1.3 mb/d lower than a year earlier (IEA).
U.S. retail diesel set records in September: $6.529 in EIA’s weekly series (Sept. 21) and $6.5276 in AAA’s daily series (Sept. 22).
E. Timeline
| Date (2026) | Event |
| July 30, 2026 | Valero reports Q2 2026: $12.62/share reported, $12.54 adjusted; $2.6B returned to stockholders. |
| Sept. 8 | Valero sets Q3 release for Oct. 22, call at 10 a.m. ET (9 a.m. CT). |
| Sept. 15-28 | Halliburton (Sept. 15), Phillips 66 (Sept. 16), Marathon (Sept. 17) and PBF (Sept. 28) announce Q3 dates. |
| Sept. 21-22 | EIA weekly diesel peaks at $6.529 (Sept. 21); AAA records its all-time diesel high of $6.5276 (Sept. 22). |
| Sept. 30 | ENB Gulf Coast 3-2-1 crack averages $75.59 for September, the highest month in EIA spot data since 2006 (ENB calculation). |
| Oct. 6 | UBS raises VLO Q3 EPS estimate to $20.00 and price target to $467. |
| Oct. 14 | IEA October Oil Market Report; EIA Gasoline and Diesel Fuel Update (diesel $6.179 for Oct. 12). |
| Oct. 15 | EIA WPSR for week ending Oct. 9: distillate stocks 102.6M bbl; utilization 93.5%. |
| Oct. 16 | Zacks consensus $21.23; ExxonMobil flags ~$4.5B refining-margin boost; VLO closes $444.71. |
| Oct. 19 | AAA diesel $6.3187, regular $4.2953; Brent $107.57, WTI $99.46 at 1:19 a.m. CT (Reuters); Iran says Hormuz offer “still on the table.” |
| Oct. 20 | Halliburton Q3 results (8 a.m. CT call). EIA Gasoline and Diesel Fuel Update next release (per EIA). |
| Oct. 22 | Valero Q3 2026 results before the market opens; call 9 a.m. CT. |
| Oct. 28 / Oct. 29 | Phillips 66 (webcast noon ET, 11 a.m. CT) / PBF Energy (8:30 a.m. ET, 7:30 a.m. CT). |
| Nov. 3 | Marathon Petroleum call, 11 a.m. EST (10 a.m. CT). |
F. Methodology
Diesel breakdown (Chart 1): crude = WTI Cushing spot ÷ 42; refining = Gulf Coast ULSD spot minus crude; taxes = EIA average federal + state diesel tax (July 2025 and July 2026 tables); distribution & marketing = retail minus ULSD spot minus taxes. Same-week inputs. This mirrors EIA’s “What we pay for” idea but is not EIA’s method, which uses refiner acquisition cost and monthly wholesale data.
Crack spreads (Chart 2): daily EIA spot prices; days missing any of the three series dropped; monthly and quarterly simple averages. Oct. 9 and Oct. 12 values are identical in EIA’s file (the Oct. 12 federal holiday).
Distillate five-year range (Chart 4): for each 2026 week, ENB takes the nearest-dated EIA week in each of 2021–2025 and computes the mean, min and max. EIA’s own five-year method may differ slightly. “Lowest for this time of year since 1982” compares weeks within ±3 days of the same calendar date in EIA’s series, which starts Aug. 20, 1982.
Valero margin sensitivity: $1/bbl × 2.95 million b/d (Q2 2026 throughput) × 92 days ≈ $271 million per quarter before costs, taxes and capture rate.
Wallet example: 30 gallons × ($6.3187 − $3.6308) = $80.64 (AAA current vs. year ago).
Other ENB calculations: UBS target vs. close: $467 ÷ $444.71 − 1 = 5.0%. Share of the pump-price rise from refining: (2.311 − 0.718) ÷ (6.179 − 3.665) = 63%. October-to-date crack vs. September: 65.68 ÷ 75.59 − 1 = −13%.
G. What ENB could not confirm
- Whether Valero’s Q3 2026 EPS will actually be a record. Only estimates exist until the Oct. 22 release.
- The full UBS research note. ENB saw only the excerpt published by StreetInsider; the UBS analyst’s name was not given there.
- Whether the Zacks consensus ($21.23 as of Oct. 16) has changed since publication.
- Valero’s actual Q3 buybacks (UBS models $3.3B), realized refining margin per barrel and capture rate versus screen cracks.
- Whether $12.62 is the highest quarter in Valero’s entire history. SEC XBRL quarterly data back to 2008 (10-Q quarters) show nothing higher, and UBS calls it the “prior high,” but ENB did not individually check every fourth quarter before 2024.
- Whether a Hormuz agreement is near. Gulf News reports only a conditional Iranian proposal and no agreement.
- A live Brent/WTI quote at publication time. ENB relies on Reuters’ 0619 GMT (1:19 a.m. CT) figures.
- EIA’s own “X% below the five-year average” wording for distillates this week. EIA discontinued the WPSR highlights PDF effective Sept. 23, 2026, so the 12.2% figure is an ENB calculation from EIA data.
- The effect of state fuel-tax holidays (e.g., Ohio’s diesel suspension) on the national average tax used in ENB’s breakdown. ENB used EIA’s July 2026 average.
- Estimates for Phillips 66, PBF and Marathon. Not used in the article.
H. Corrections to early reports
| Early report or lead | What ENB found |
| Brief: Q2 “record of $12.62” vs. UBS ~$20 and Zacks $21.23 | $12.62 is reported (GAAP) EPS. Adjusted Q2 EPS, the basis analysts use, was $12.54 (Valero Q2 release). ENB states both. |
| Brief: UBS expects ~$20 “vs. Street” | UBS’s note (Oct. 6) cited a Street estimate of $18.34. That is now stale; Zacks shows $21.23 as of Oct. 16. |
| Brief: peers “PBF, PSX (Oct 28), MPC (Nov 3)” | Confirmed PSX Oct. 28 and MPC Nov. 3 (call 11 a.m. EST = 10 a.m. CT). Added PBF date: Oct. 29 (call 8:30 a.m. ET). |
| Brief: diesel ~$6.319, regular ~$4.295 | Confirmed on AAA: $6.3187 and $4.2953 (Oct. 19). No correction; ENB rounds to $6.32 and $4.30. |
| Brief: distillates ~12% below 5-yr average | Confirmed as 12.2% (ENB calculation from EIA weekly data). Note: the 12.3% figure in EIA Table 1 is the change vs. a year ago, not vs. the five-year average. |
| Bloomberg: Gulf Coast 3-2-1 record of $72.64 on Sept. 22 | Not a correction. ENB’s EIA-spot version (vs. WTI Cushing) peaked at $90.85 on Sept. 23. Different crude benchmarks and price series give different levels. |
