San Antonio-based Valero Energy is reporting a 28 percent increase in its fourth quarter earnings, and officials say the nation’s oil industry is healthier as a whole now that the recession is coming to an end.
Valero Wednesday reported an increase of $1.3 billion dollars over the fourth quarter earnings of 2012.
Vice-President of Media and Community Relations Bill Day said the company is starting to see steady increases now, in part due to the end of the recession.
“But honestly a lot of it is because of the influx of crude oil production here in the United States and in North America," Day said. "When you have more production here in the Eagle Ford area or out in the Permian Basin or in the Bakken [Shale] up in the Dakotas, you’re less susceptible to some of the swings and volatility because of geo-political issues.”"
Day said most refineries should be doing better now but said demand for gasoline has dropped and the country will never again buy as much gasoline as it did before the peak demand just before the economic downturn.
“The population as a whole is getting older and people are retiring in larger numbers, so they don’t drive as much," Day said. "CAFÉ standards have led to more fuel-efficient vehicles and then the mandate by the government to use ethanol in gasoline. If there is any incremental demand, it will be made up by increased use of ethanol rather than increased use of gasoline."
Day said Valero is protecting its position by investing in more ethanol production and marketing its oil products for export.
*Disclosure Note: Bill Day is a member of the Texas Public Radio board of directors.