Mixed First Quarter Results for Sunoco

Not every oil company is enjoying windfall profits in the era of expensive oil.

Sunoco Inc., which refines oil it buys from producers, today reported a net loss of $59 million on sales of $12.8 billion for the first quarter of the year. Sunoco earned $175 million on sales of $9.3 billion in the first quarter of 2007. The 2007 figures included special items valued at $90 million, according to the Philadelphia Inquirer.

"The first-quarter market environment was clearly a challenging one for Sunoco and the refining industry," Sunoco chairman John Drosdick said in written statement.

The company lost $123 million in its core refining and supply business. Margins there were squeezed by the record-high prices for crude oil. Customer demand also fell, Drosdick said. But the company’s retail-marketing business, its gas stations and convenience stores, posted a profit of $26 million for the quarter. That was largely due to higher margins, compared with the first quarter a year earlier, on gasoline and diesel sold at those outlets.

Sunoco’s margin on a gallon of gas was about 11 cents in the first quarter of 2008, compared with 8 cents in the first quarter a year earlier.

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