Tesoro 3Q Profit Plunges 87 Pct On Weaker Margins

SAN ANTONIO (AP) — Independent oil refiner Tesoro Corp. on Monday said its net income tumbled 87 percent as lower energy prices cut away at margins.

Crude oil prices have climbed steadily since March, but gasoline prices haven't matched the pace, hurting margins for refiners.

Tesoro said lower margins for distillates and weaker discounts for heavy crudes especially hurt margins. However, West Coast spot gasoline prices improved during the quarter, softening the blow.

"We continue to view the West Coast as an attractive market in which to do business, especially with the increasing stability in gasoline demand we are experiencing through our retail channels," said CEO Bruce Smith.

Earnings for the quarter ended Sept. 30 fell to $33 million, or 24 cents per share, compared with $259 million, or $1.86 per share during the same period last year.

Analysts polled by Thomson Reuters estimated a profit of 1 cent per share, on average.

Revenue declined 45 percent to $4.74 billion, down from $8.68 billion in the prior-year period. Analysts forecast an average revenue of $4.71 billion.