Third-quarter segment operating income was $201 million, compared to $137 million in the third quarter a year ago. The increase in operating income was driven by stronger distillate margins, improved feedstock cost and the company's improvement initiatives. These benefits were partially offset by decreased gasoline margins and reduced throughput. [image-nocss] The reduction in throughput was primarily a result of the continued shutdown of the Anacortes refinery and the planned turnaround of its Hawaii refinery.
For the third quarter, the Tesoro Index gained $1.42 per barrel or 17% from a year ago. West Coast benchmark diesel margins were up more than 50% over last year while gasoline margins were down 7%. The company realized all of the index gains and more, capturing a gross margin of $13.28 per barrel, which was up $3.69 per barrel or 38% from a year ago.
"We are pleased with our third-quarter results, even with Anacortes down for the period," said Greg Goff, president and CEO of Tesoro. "During the quarter, we saw improvement in distillate margins in our markets similar to what's been seen across the country. We attribute this to strong distillate exports, improvements in the U.S. manufacturing sector and increased port activity nationwide. Unfortunately, these increases are not being seen in gasoline margins. While gasoline demand has stabilized, high unemployment in California continues to keep gasoline demand weak."
San Antonio, Texas-based Tesoro is an independent refiner and marketer of petroleum products. Tesoro, through its subsidiaries, operates seven refineries in the western United States with a combined capacity of approximately 665,000 barrels per day. Tesoro's retail-marketing system includes more than 875 branded retail stations, of which more than 380 are company operated under the Tesoro, Shell, Mirastar and USA Gasoline brands.
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