As Marathon Petroleum cuts costs, fuel prices continue to climb, resulting in high Q3 profits.
Earnings totaled $1.13 billion, or $3.16 per share, for the three months ended Sept. 30, more than four times the $277 million, or 77 cents per share, it earned for the same part of 2010. Revenue increased 30% to $20.65 billion in the quarter. The increase came as Marathon’s refineries used relatively cheap oil while prices rose for the fuel it sold. Retail gasoline prices increased 33%, diesel prices rose 32% and jet fuel prices grew 46% in the quarter.
The results exceeded analyst forecasts of $2.44 per share on revenue of $18.12 billion, according to FactSet, Bloomberg Businessweek noted. However, analysts predict oil refiners will see profits diminish in the last three months of 2011 given recent volatility in oil and petroleum product prices.
Meanwhile, Marathon’s Speedway retail gasoline business saw profits drop 28.5% to $85 million while its pipeline business increased earnings 43.6% to $56 million.