Adds info on Venezuela oil purchases; recasts lead.
US independent refiner Valero has ramped up purchases of Venezuelan crude and expects it to be a major heavy feedstock this quarter, the company said today.
Valero has purchased Venezuelan crude from the three authorized sellers, said vice president of crude and feedstocks supply and trading Randy Hawkins on a fourth-quarter earnings call.
The Venezuelan oil is expected to make up "a pretty large part" of Valero's heavy crude diet as the company moves into February and March, Hawkins said. The refiner did not disclose pricing but said that heavy crude differentials in general were favorable.
Venezuelan crude is replacing various other grades, including heavy crude from Latin America and western Canada, Valero said.
"The exports that are coming out of Venezuela tend to be very heavy, high sulfur... and that fits [Valero's] configuration pretty well," Hawkins said.
Valero ran as much as 240,000 b/d of Venezuelan heavy crude in the past before US sanctions, but that was prior to installing a new coker at its 380,000 b/d Port Arthur, Texas, refinery in 2023 which increased processing capacity for heavy crude, Hawkins said.
Now, Valero can run Venezuelan crude "substantially north of that number", he said.
Market sources said on 23 January that Valero purchased an Aframax shipment of heavy sour Venezuelan crude.
Trading firms Trafigura and Vitol were approved by the US government to market unsanctioned Venezuelan crude following the US capture of former Venezuelan president Nicolas Maduro on 3 January. Both firms were heard recently offering Venezuelan cargoes to the US market at a $9/bl discount to Ice Brent on a delivered basis. Market sources said most cargoes on offer to the US Gulf coast were for Aframax vessels, and deals were expected to continue to be struck at deep discounts to Ice Brent.
Chevron is also authorized to sell Venezuelan crude. Chevron operates in Venezuela with state-owned PdV under a special waiver from US sanctions and imported about 120,000 b/d of crude from Venezuela to the US in December, according to data from Kpler ship tracking.
US secretary of state Marco Rubio said on Wednesday that the US administration wants Venezuela's state-owned PdV to eventually resume selling crude and refined products directly, instead of relying on US-mandated sales through Trafigura and Vitol.
Record throughputs in 4Q
Valero also reported record crude throughputs in the fourth quarter of 2025 as well as higher profits.
Refining throughput volumes averaged 3.1mn b/d in the fourth quarter, while Valero's refining segment reported operating profit of $1.7bn, up from $437mn in the fourth quarter of 2024.
The company reported an average refining margin of $13.61/bl in the fourth quarter, up from $8.44/bl in the fourth quarter of 2024.
The company paid an average of about $59/bl for US benchmark WTI crude in fourth quarter, down from about $70/bl in the year-earlier period.
Valero also said its fluid catalytic cracker (FCC) unit optimization project at the 215,000 b/d St Charles refinery in Norco, Louisiana, is on track to start operations in the second half of 2026.
The project will allow the refinery to increase the yield of high-value products including alkylate. The project is estimated to cost $230mn.
Valero is preparing to start idling processing units at its 145,000 b/d refinery in Benicia, California, in February as part of a previously announced plan to idle, restructure or cease refinery operations at the facility, which is in the San Francisco area.
Valero plans to import additional gasoline volumes in the near term to meet contractual supply obligations.
The company said on Thursday that its operating expenses in 2025 included $50mn for employee retention and separation costs related to Benicia.
