Posts by Hoekstra Trading LLC
Refining catalysts True or False?
About refining catalysts: True or false?1) The market share leader has the best catalysts2) You can rely on vendor data3) Catalyst performance has tripled in the last 15 years4) Engineers resist change5) Procurement people are bean-counters6) Catalysts are chosen to maximize profitability7) Catalysts choice must be customized for each unit8) If unit performance is bad…
Read MoreUpdate on the MPC-PSX stock price spread
Throughout 2021 and 2022, I have been tracking the difference in performance of Marathon Petroleum (MPC, green) and Phillips 66 (PSX, red) stock. The first blog post, from Dec 8, 2021, showed the difference being 60% gain for MPC versus 1% gain for PSX. The S&P 500 index is shown for reference: Now, 100 days…
Read MoreDo refiners buy catalysts on relationships or economic value?
Which would a catalyst sales person rather have: a strong personal relationship with the key decision maker, or the catalyst offer with best economic value? I have asked this question of 100+ catalyst sales people. Most say they’d rather have the personal relationship because it has more impact in affecting sales. Having worked my entire…
Read MoreConstipated refineries
Recently, it was reported that PBF Energy is considering restarting some secondary units at is partially-idled refinery in Paulsboro, New Jersey. When explaining this possibility, CEO Tom Nimbley diagnosed the situation as constipation: . . as we started to see demand recovery and growing up our utilization, particularly in Delaware to take advantage of the…
Read MoreRefining earnings news signals Tier 3 margin squeeze
Some news from recent refining earnings reports: Cenovus (CVE) reports low refining profitability Cenovus attributed low 4th quarter refining profits to a major turnaround at its Lima, Ohio, refinery and to post-turnaround challenges with secondary processing units: “In the US manufacturing segment, refinery utilization averaged 72% in the quarter. This reflects the impacts of a…
Read MoreCapturing RIN trading profits by theoretical price modeling
On December 14, 2021, Hoekstra Trading notified our clients of a RIN credit spread trading opportunity which is indicated by the gap between the dark green and light green data points on this chart: The black line is the theoretical value calculated by the Hoekstra RINs price spreadsheet model. The opportunity was to sell the…
Read MoreWhen are two catalysts really different?
When testing catalysts, we always dedicate one of the four reactors to a reference catalyst sample, to determine the margin of error. For example, here is an excerpt from Hoekstra Research Report 2 showing results for the Albemarle KF767 reference catalyst in three different pilot plant runs testing diesel fuel desulfurization catalysts: Most often, the…
Read MoreAn update on the MPC-PSX stock price spread
Six weeks ago, this comparison of Marathon Petroleum Corp (MPC – green) and Phillips 66 (PSX -red) 2021 stock price performance highlighted a striking difference: Since then, oil stocks have surged. Here is how the same chart looks six weeks later MPC and PSX have both increased 20%, relative to the base point on the…
Read MoreStretching catalyst performance claims
One reason refiners want independent catalyst testing is they sometimes get burned by exaggerated vendor claims on catalyst performance. Here is one example from our six-year standardized multi-client catalyst testing program. CENTINEL and CENTERA In 2009, Criterion (now Shell Catalysts & Technologies) was promoting their new CENTERA catalysts for diesel desulfurization. CENTERA was Criterion’s fifth…
Read MoreAccurate modeling of RIN prices
The Hoekstra IMS RIN price spreadsheet model accurately tracked the D4 RIN price during 2021. The green data points are the daily closing price of the 2021-vintage D4 RIN reported by Banyan Commodities. The black line is the price calculated by the model using weekly data on biodiesel and ultra-low sulfur diesel (ulsd) prices. All…
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