New York, January 7, 2026, 14:27 (ET) — Regular session
- Valero shares up about 4% in afternoon trading; stock touched $191 earlier
- Company plans phased idling of Benicia refinery from February; says it will keep supplying Northern California via inventories and imports
- Traders also track Venezuela supply headlines and a sharp build in U.S. fuel inventories
Valero Energy Corp shares rose 4.4% to $186.08 in afternoon trade on Wednesday after the refiner said it will keep importing gasoline into Northern California as it idles its 145,000-barrel-per-day Benicia refinery in April 2026. Valero plans to begin idling process units in February for mandatory state inspections and expects most units to be properly shut down by April; California Governor Gavin Newsom called the move a “constructive shift” and Valero said it will meet contractual supply obligations by drawing on inventories and imports. The stock hit $191 earlier; Marathon Petroleum rose 1.6%, Phillips 66 added 0.4% and PBF Energy gained 5.1%. 1
Refiner shares have been whipping around Venezuela this week, as Washington weighs steps that could steer more heavy sour crude — oil with higher sulfur content — toward U.S. plants built to run it. Oil slipped after President Donald Trump wrote on social media that Venezuela would turn over 30 million to 50 million barrels of sanctioned crude to the United States; Tina Teng, a market strategist at Moomoo ANZ, said the stance looked set to “rather increase supply than limit it,” feeding oversupply worries. Morgan Stanley has projected a surplus of up to 3 million barrels a day in early 2026. 2
The weekly U.S. inventory report added a second push-and-pull: crude stocks fell 3.8 million barrels to 419.1 million barrels, but gasoline inventories jumped 7.7 million barrels to 242 million and distillate stockpiles rose 5.6 million barrels to 129.3 million, the Energy Information Administration reported. Big product builds can pressure crack spreads — the price gap refiners earn turning crude into fuel — even when crude supplies tighten. 3
At an energy conference on Tuesday, Phillips 66 CFO Kevin Mitchell said the company’s Lake Charles and Sweeny refineries can process a couple of hundred thousand barrels per day of Venezuelan crude as production ramps up. CEO Mark Lashier said Phillips 66 has “refineries designed for the long term to process that crude,” but he cautioned it would take “years, if not decades” of upstream spending to restore Venezuela’s production potential. Analysts have noted refiners such as Valero and Marathon could be among the direct beneficiaries if more Venezuelan heavy grades return to U.S. Gulf Coast runs. 4
Investors are also watching Washington’s next moves more closely than usual. Trump is expected to meet oil company executives late this week, with two sources telling Reuters the meeting is likely on Friday. Daan Struyven, co-head of global commodities research at Goldman Sachs, told the same conference it was hard to imagine Venezuela adding more than 300,000 to 400,000 barrels a day in the next year, given degraded infrastructure, even as Interior Secretary Doug Burgum argued some steps could move quickly and called the business opportunity “enormous.” 5
For Valero, the Benicia decision keeps it in the Northern California market even as it starts a staged shutdown of the plant’s processing units. Traders said the near-term focus is less about the 2026 timetable and more about what it says on strategy: supply commitments, import economics, and whether California’s regulatory and cost pressures force further portfolio changes.
But the setup has clear ways to go wrong. If gasoline and distillate inventories keep swelling, wholesale fuel prices can soften and squeeze margins into earnings season. And the Venezuela trade is political first — any shift in U.S. policy, sanctions, or output expectations can hit both crude differentials and refiner valuations in a hurry.
Next up, investors get a harder read on margins and 2026 priorities when Valero reports fourth-quarter and full-year 2025 results on Jan. 29, before the market opens, followed by a 10 a.m. ET management call. 6
