Refiner Phillips has reported a 70 per cent plunge in quarterly profit, as it was hit by lower margins and higher turnaround activity at its refineries, it said in an update. Turnarounds, which are planned capital projects, are a core part of the refining business and help prevent unexpected shutdowns and accidents.

Adjusted earnings fell to £522 million, or £1.17 per share, in the fourth quarter ending December 31, from £1.71 billion (or £3.69 per share), a year earlier. 

Phillips 66 missed analysts’ estimates for quarterly profit. The company said adjusted earnings at its refining segment plunged nearly 83 per cent to £261 million in the quarter, as the refiner’s crack spread, (or the difference between the price of crude oil and finished products), fell in the quarter.

It added that refiners in the US have been facing challenges to obtain low-cost heavy crude, as prices have been hit by production cuts from Canada’s Alberta province, the Organization of Petroleum Exporting Countries as well as US sanctions on Venezuela and Iran.

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3rd February 2020