Houston refining and pipeline company Phillips 66 on Friday reported a $689 million fourth-quarter profit, 51 percent less than the same period in 2018.
The fourth quarter performance resulted in Phillips 66 closing 2019 with a nearly $3.7 billion profit, a 35 percent drop from the previous year when favorable margins in the refining of domestic crude oil swelled profits. The
West Texas Intermediate crude oil prices fell by 40 percent during the fourth quarter of 2018 and entered the $40 per barrel range, creating losses for exploration and production companies and services companies but windfalls for refining companies that were able to process domestic crude.
Crude oil prices have since settled in the $50 per range, which are still beneficial to refining companies but not as profitable.
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Phillips 66’s pipeline business took a $900 million hit during the third quarter for impairments related to writing down the value of DCP Midstream, a gathering and processing plant joint venture with Canadian pipeline operator Enbridge.
In a statement, Phillips 66 Greg Garland focused on future growth. The company placed its Gray Oak Pipeline into service in November. When in full service early this year it will move 900,000 barrels of crude oil per day from Texas’ Permian Basin and Eagle Ford Shale to the company’s refinery in Brazoria County and the Port of Corpus Christi.
“As we begin 2020, we are focused on operating excellence, executing our growth projects, enhancing returns on existing assets and exercising disciplined capital allocation,” Garland said.
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