Independent U.S. refiner Valero Energy warned of as much as $2.1 billion first-quarter loss and withdrew its full-year outlook Monday, as lockdowns to suppress the coronavirus hit demand for its gasoline, jet fuel, and other products.
Refiners have lowered production and slashed expenses to confront a 30% drop in worldwide fuel demand as nations place bans on airways and businesses to reduce the spread of the virus. U.S. gasoline demand fell almost 50% in the three weeks ended April 3.
While withdrawing its earnings estimation for this year, Valero also stated it was taking steps to improve liquidity, including by deferring tax payments and sure planned expenses in its refining and ethanol companies.
The refiner has access to $5 billion in the capital and is “an investment grade, prime quality balance sheet firm…and low-cost operator,” a Valero spokesperson stated declining another comment.
It has deferred around $100 million of tax payments due in the first quarter ended March 31 and plans to defer remaining tax payments for this year up to it can.
The projected loss would mark a steep drop from the same period in 2019 when it reported revenue of $24.26 billion and net revenue of $141 million.