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Marathon Petroleum's Q3 profits miss estimates due to higher turnaround costs
Marathon Petroleum, a U.S. refiner, missed Wall Street's expectations for the third quarter profits on Tuesday as higher turnaround costs in refining and losses from renewable diesel weighed on performance. At 1:30 pm, shares of Marathon, which is the largest refiner in the United States by volume, had fallen about 7%. ET (1830 GMT). Marathon's results highlight the challenges facing U.S. refining companies as inflation and high maintenance costs eat away at earnings, despite strong demand. According to LSEG, the company reported a quarterly profit of $3.01, compared to an average analyst estimate of $3.15. Analysts said the results were disappointing, as the earnings missed was rare and came despite outperformance of peers. Valero Energy, Phillips 66, and HF Sinclair all reported better than expected results due to a rebound in the refining margins. COSTS ARE HIGHER, BUT RESULTS ARE LOWER Marathon reported $400 in quarterly refining turn-around costs. This is up from $287 millions a year earlier, due mainly to increased planned maintenance activities. The company estimates that the turnaround expense for the fourth-quarter will be approximately $420 million. This is mainly due to activity on the West Coast. For the third quarter 2025, refining costs increased to $5.59 per barrel from $5.23 a barrel. Refiners in the Gulf Coast reported an increase in operating costs from $3.96 to $4.70 a barrel. John Quaid told investors Tuesday that the downtime at the Galveston Bay Refinery, which is the second largest refinery in the U.S. by capacity, caused by a June fire, had a negative impact on the Gulf Coast's capture rate and results. Marathon plans to invest $200 million in a project for upgrading Galveston Bay’s distillate-processing unit this year, and another $575 million over the next two. The quarter's refining and selling margin was $17.60 a barrel, compared to $14.63 a barrel one year ago. Analysts noted that the third quarter West Coast refining profits of $947m were lower than expected. The refiner’s renewable diesel segment posted a loss of $56M for the third quarter, down from a loss of $61M a year earlier. Executives said that the results were affected by lower margins during the third quarter, due to higher prices for feedstock. Marathon said that its 13 refineries ran at 95% capacity in the third quarter. This is up from 94% one year earlier. The company plans to run its facilities at 90% capacity by the fourth quarter 2025.
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As the market waits for US jobs data, gold slips by more than 1%.
The dollar reached three-month highs as traders awaited U.S. data to determine the Federal Reserve's policy. As of 2:15 pm EST (1915 GMT), spot gold was down by 1.5% at $3,940.75. U.S. Gold Futures for December Delivery fell 1.3% and settled at $3,960.50. Gold is more expensive for holders of other currencies as the dollar index has reached three-month highs. David Meger is the director of metals at High Ridge Futures. He said, "We're seeing the dollar reaching new highs and that it has a weight in the market. Fed Chair Jerome Powell said that the Fed's interest rate cut last week might not be the last for the year. CME Group's FedWatch tool shows that traders now expect a rate reduction at the Fed meeting on December 9-10, down from more than 90% one week ago. Gold that does not yield is a good investment in low interest rate environments and times of economic uncertainty. Investors are paying more attention to non-official economic data such as the ADP National Employment Report, since the U.S. shutdown is likely to be the longest in history, and will halt the release of official government data. ADP's October report is scheduled to be released Wednesday. The Fed's comments have revealed different perspectives on the data gap. Bullion has lost more than 9% of its value since October 20, when it reached a record high. Gold is losing some of its froth, but still prices in the concerns about Fed independence, stagflation and underlying geopolitical risks and tensions. In a note, Rhona O’Connell, an expert at StoneX, stated that some of the froth had been blown away in a much needed correction. Palladium dropped 3.1% to 1,400.30. Platinum was also down 1.8% at $1,538.05. (Reporting from Noel John in Bengaluru and Pablo Sinha; Editing by Alexander Smith and Paul Simao)
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Oil prices fall on strong dollar and fears of oversupply
The oil prices fell on Tuesday due to weaker manufacturing data and a stronger US dollar. In addition, the OPEC+'s decision to pause production increases in the first quarter next year may signal their concern over a possible supply glut. Brent crude futures were down 31 cents or 0.5% to $64.58 per barrel at 12:27 pm (1726 GMT). U.S. West Texas Intermediate Crude was down 33 cents or 0.5% at $60.72. The high dollar valuation is putting pressure on crude futures today. U.S. stocks are also experiencing a large downside correction during the early trading as the government shut down may begin to add downward pressure. This could ultimately hurt domestic fuel consumption," said Dennis Kissler. Senior vice president of BOK Financial's Trading Department. The dollar rose to a new four-month high versus the euro on February 2, as doubts about another rate cut in this year were raised by divisions within the Federal Reserve. The dollar's strength makes assets priced in dollars, such as oil, more expensive for those who hold other currencies. Wall Street's major indexes fell to a new low on Tuesday, after some large U.S. financial institutions warned of a possible market decline. The U.S. shutdown entered its 35th consecutive day on Tuesday, matching the record for longest government shutdown in history set by President Donald Trump during his first term. The cost is increasing every day. The first time food assistance was stopped for the poor, federal employees from airports to the military and law enforcement are not paid and the economy is blinded by limited government reporting. A private sector survey revealed that in Asia, Japan's manufacturing activities shrank at the fastest rate in 19 months in October due to a slump in demand for key automotive and semiconductor products. On the supply-side, the Organization of the Petroleum Exporting Countries (OPEC+) and its allies agreed on Sunday to a modest increase in oil production for December, and a pause of increases in the first three months of 2019. Bjarne Shieldrop, SEB Research's chief commodities analyst, said that the U.S. sanctions against Russian energy companies Lukoil, and Rosneft were fading. "On Nov 21, when the sanctions are imposed (on companies that continue to do business with Russian companies), they will most likely disappear, or be pushed away in due time." The American Petroleum Institute is expected to release its latest U.S. inventories later today. According to a preliminary poll, U.S. crude stockpiles are expected to have increased last week. Reporting by Seher DAREEN in London, Ashitha SHAIVPRASAD in Bengaluru, and Emily Chow, in Singapore. Editing by Ros ROUSSEL, Louise Heavens, and Tomasz JANOWSKY
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IDB announces first Amazonia Bonds and expects Brazil to follow in
Inter-American Development Bank's (IDB) first Amazonia Bond raised $100 million to combat deforestation, boost local communities and support them, according to its chief. Other countries will follow soon. The coupon rate for the five-year bond is 3.802%. Ilan Goldfajn, President of the IDB, said that the operation is the start of a plan for the IDB to issue bonds up to $1 billion "over time." He added that the Brazilian government has told them they intend to issue similar bonds using the same framework developed by the IDB and the World Bank. Brazil's Treasury said that "studies are underway" to evaluate the issue of Amazonia Bonds. The Treasury issued its first sustainable sovereign bond in 2023, under a framework it developed itself. Brazil, Colombia, and Peru are three of the countries that work to protect the Amazon rainforest. This region is home to over 10% of all known species on the planet. Goldfajn stated that the issuance was part of a package IDB initiatives aimed at boosting sustainable finance in advance of next week's COP30 Climate Summit. About $3 billion of this amount will be used to provide currency-hedging services to Brazil through a derivatives agreement with the central banks, who will then extend the service to the local banks. Goldfajn explained that the currency-hedging, announced last year as part Eco Invest – a Brazilian government initiative to attract foreign capital for long-term sustainable project – took time to overcome its technical obstacles. The ISDA agreement will now be signed the following week. The triple-A rating of the IDB is being used to provide lower-cost, longer-term hedging against fluctuations in the local currency. The Brazilian real has gained more than 13% this year, after losing over 20% in 2024. Lula's government will announce a fourth Eco Invest Auction as part of the COP30 announcements. This auction is now aimed at Amazon bioeconomy projects and nature-based tourist infrastructure. Goldfajn stated that the IDB would also seek to increase access to financing for regional cities via its Amazonia Forever Program so they could improve their resilience to flooding, droughts and fires. He added that the project was developed in conjunction with Nordic partners, who provided guarantees for lending. He said that when people in other countries hear about the Amazon, they only think of the forest. "For years, that narrow view focused on deforestation. That's changing. "Our approach is holistic. If we provide people with sustainable living conditions and income, they can live in peace within the forest." (Reporting by Marcela Ayres; Editing by Alexandra Hudson)
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IDB announces first Amazonia Bonds and expects Brazil to follow in
Inter-American Development Bank's (IDB) first Amazonia Bond raised $100 million to combat deforestation, boost local communities and support them, according to its chief. Other countries will follow soon. The coupon rate for the five-year bond is 3.802%. Ilan Goldfajn, President of the IDB, said that the operation is the start of a plan for the IDB to issue bonds up to $1 billion "over time." He added that the Brazilian government has told them they intend to issue similar bonds using the same framework developed by the IDB and the World Bank. Brazil's Treasury said that "studies are underway" to evaluate the issue of Amazonia Bonds. The Treasury issued its first sustainable sovereign bond in 2023, under a framework it developed itself. Brazil, Colombia, and Peru are three of the countries that work to protect the Amazon rainforest. This region is home to over 10% of all known species on the planet. Goldfajn stated that the issuance was part of a package IDB initiatives designed to increase sustainable finance in advance of next week's COP30 Climate Summit. About $3 billion of this amount will be used to provide currency-hedging services to Brazil through a derivatives agreement with the central banks, who will then extend the service to the local banks. Goldfajn explained that the currency-hedging, announced last year as part Eco Invest – a Brazilian government initiative to attract foreign capital for long-term sustainable project – took time to overcome its technical obstacles. The ISDA agreement will now be signed the following week. The triple-A rating of the IDB is being used to provide lower-cost, longer-term hedging against fluctuations in the local currency. The Brazilian real has gained more than 13% this year, after losing over 20% in 2024. Lula's government will announce a fourth Eco Invest Auction as part of the COP30 announcements. This auction is now aimed at Amazon bioeconomy projects and nature-based tourist infrastructure. Goldfajn stated that the IDB would also seek to increase access to financing for regional cities via its Amazonia Forever Program so they could improve their resilience to flooding, droughts and fires. He added that the project was developed in conjunction with Nordic partners, who provided guarantees for lending. He said that when people in other countries hear about the Amazon, they only think of the forest. "For years, that narrow view focused on deforestation. That's changing. "Our approach is holistic. If we provide people with sustainable living conditions and income, they can live in peace within the forest. (Reporting by Marcela Ayres; Editing by Alexandra Hudson)
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Dollar gains; stocks pull back from recent rally
The major stock indexes fell on Tuesday. Chip stocks were also lower. Goldman Sachs' and Morgan Stanley's chief executives warned that the market could be headed for a correction. Meanwhile, the dollar rose to a 4-month high against the Euro. The dollar was also supported by the drop in U.S. Treasury Yields, as a result of a risk-off mood. The CEOs of the banks You can also read about the warnings below. At an investment summit held in Hong Kong, the possibility of a stock-market correction of over 10% within the next two year was discussed. Early shares of Nvidia fell by more than 2%, and an index of semiconductors was also down by about 2%. Palantir Technologies shares fell more than 7%, despite a strong quarter of results. The company has seen its value more than double this year. forecast fourth-quarter results Demand for data analytics services is above expectations due to a rapid adoption of AI. Michael Burry (the investor behind the "Big Short"), who is known for making successful bets in 2008 against the U.S. Housing Market, has placed bearish bets now on Nvidia, and Palantir. This was revealed by a filing to regulatory authorities on Monday. The Nasdaq fell more than 1% and led the declines of all three major U.S. indexes. The Nasdaq has still gained nearly 22% this year. Keith Buchanan is a senior portfolio manager with Globalt Investments. The Dow Jones Industrial Average dropped 190.95, or 0.40% to 47,147.49. The S&P 500 declined 54.48, or 0.80% to 6,797.49. And the Nasdaq Composite lost 316.86, or 1.33% to 23,517.86. The MSCI index of global stocks fell 8.53 points or 0.84% to 999.38. The pan-European STOXX 600 fell by 0.42%. Prior to that, Asian stocks had fallen from their all-time highs. Stocks rose Monday after Amazon announced a $38 billion deal for cloud services with ChatGPT creator OpenAI. Divides within the Fed have raised doubts about another rate cut in this year. Jerome Powell, the Fed Chair, said that a rate cut in December was not predetermined. The Fed lowered its rates last week. CME FedWatch shows that traders now place a 65% probability of a December rate cut, down from 94% one week ago. The euro has fallen for the first time in a decade Fifth consecutive session The dollar was down by 0.3% to $1.148. This is its lowest level since August 1. The dollar fell 0.5% against the yen but the Japanese currency was still near its previous level. The following are some recent examples of the use of 8-1/2-month low. Sterling fell after UK Finance Minister pointed out that her budget will include "hard decisions". Sterling fell 0.72% to 1.3044. Bitcoin, the cryptocurrency, fell 2% to $107 486. This was its lowest level since June. U.S. Treasury rates declined amid a risk-off mood on the financial markets. Due to the shutdown of the federal government, the Bureau of Labor Statistics' closely-watched monthly jobs report will not be released on Friday as originally scheduled. The yield on the benchmark U.S. 10 year notes dropped 2.6 basis points from 4,107% at late Monday to 4,081%. U.S. crude dropped 0.64% to 60.66 per barrel. Brent was down to $64.50 a barrel, a 0.6% drop on the day. Spot gold dropped 0.67% to an ounce of $3,975.00.
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After Russia sanctions, BGN CEO looks to petchem and Med growth for asset purchases.
BGN, a global commodities trader, sees the new sanctions against Russia as an opportunity for it to increase its presence on the Mediterranean market of energy products, said its chief executive on Monday. It is also considering investing in petrochemicals. In an interview given at the ADIPEC conference in Abu Dhabi, Ruya B. Bayegan, CEO, BGN, said that it was difficult to estimate how much trade would change in the Mediterranean as a result of recent sanctions against Russia. She said, "These changes will increase the presence of our company." We are already strong in the Med, with (oil) products. BGN has a new strategy, which involves shifting from trading to owning assets. Bayegan explained that this is to diversify BGN. She said that BGN was "studying" the possibility of acquiring petrochemical assets in Europe, including potentially distressed plants which could be relocated elsewhere. Bayegan noted that the sector was in a "bad phase." Bayegan said that the company was looking for upstream opportunities. Bayegan, who said BGN trades in 120 different countries, said that it finances its investment push with a combination equity, balance-sheet cash and "different partnership" while its trading arm is supported by established trade financing lines. In the same interview with the CEO, Wael Amer, the company said it is actively hiring to support growth. Its focus will be on expanding operations in the U.S.A., Latin America and Asia. Amer stated that recent key hires included co-heads of its LNG desk as well as a global director of metals. Amer stated that BGN has been supplying 100% of Egypt's LPG for the past eight years. Amer said that BGN recently signed a contract to supply 42 cargoes liquefied gas to Egypt. Amer stated that BGN loads one crude cargo per month in South Sudan and like its competitors, it makes prepayments on its cargoes.
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Chile's Codelco reduces copper production guidance for 2025, despite higher production in September
Chile's Codelco - the world's biggest copper producer - cut its forecast on Tuesday for 2025 production, despite a higher output in the first nine months of the year through September. The state-owned mining company lowered its copper output guidance for this year to between 1.31 and 1.34 millions metric tonnes, down from an earlier estimate of between 1.34 to 1.37million metric tons. However, it still hopes to surpass last year's 1.32 million tons. Last week, copper prices reached a record high due to concerns about mine supply and the prospect of a U.S. China trade agreement. Codelco has highlighted the production increase at the Ministro Hales Mine and the importance of the Rajo Inca project structural at the Salvador mine which is increasing production. Ruben Alvarado, CEO of the company, said that the cut in guidance "doesn't jeopardize expectations" to produce 1.7 millions tons per year by 2030. The output of the country increased by 2.1% The miner produced 937,000 tonnes in the first nine month of the year. This is a 2.1% increase over the same period the previous year. The increase in production was achieved despite a July 31 accident at Codelco's flagship El Teniente Mine, which caused a temporary stop to mining and melting. The company stated that "this unfortunate accident has impacted the results of production achieved at the end the second quarter this year." Alvarado said that Codelco anticipates having more conclusive data about the accident before the end of the calendar year. Vice President of Operations Mauricio Baraza stated that Codelco expects to also have a long term development plan for El Teniente by the end of the year, which will help mitigate the lack production using resources from the southern part of the deposit. He said it would take three years for El Teniente to reach the level of production they had prior to the accident, in which six workers were killed. The company reported a profit before tax of $606.9 millions from January to Septembre, a little below the $612.2 that was reported during the same period in 2013. Reporting by Fabian Cambero, Aida Pelaez Fernandez and Rod Nickel; editing by Kylie Madry.
Brazil Supreme Court affirms the legality of soy moratorium, traders' group claims
The grain traders group Abiove said that the vote of Brazil's Supreme Court, which took place on Monday, recognising legality and effectiveness of the soy-moratorium, a corporate agreement under investigation by Brazil’s antitrust agency, confirms its legitimacy and efficiency.
Why it's important
The ruling by Supreme Court Justice Flavio DiNo supports a longstanding corporate environment agreement that prohibits soybean traders from purchasing from farmers who cleared land from the Amazon rainforest in July 2008. It also shapes the soy trading in Brazil, which is the world's biggest soybean exporter.
CONTEXT
The soy ban was intended to reduce deforestation by limiting soy purchases in newly deforested regions. However, it has been met with opposition from small and medium soy farmers who claim the moratorium acts as a cartel.
The Supreme Court's ruling was part of an appeal about the legality a state law that prohibits tax benefits for soy processors and traders who participate in the moratorium. The Supreme Court's ruling on the legitimacy of the soy moratorium raises doubts about recent challenges against the pact at Brazil's antitrust office.
KEY QUOTES
Justice Dino stated that the soy ban "increased Brazil's credibility as it relates to international environmental commitments."
Abiove stated: "A decision this size confirms that multi-sectoral pact is an effective, legitimate initiative aligned to constitutional principles while recognising the positive environmental and agricultural impacts." Reporting by Roberto Samora, Writing by Isabel Teles, Editing by Susan Fenton
(source: Reuters)