We understand the threat that weather events can pose. Our nation’s refiners and petrochemical manufacturers have developed robust preparedness measures that can be taken in the event of a hurricane or extreme weather event.
Earnings in commodities-based industries tend to be cyclical. Because of the up-and-down reality of refining, it would be a mistake to regulate or legislate based on the high points. A few quarters of earnings don’t provide an accurate representation. That context is important for answering the question of what happens with refinery profits and whether using earnings to “buy back” stock from shareholders is an appropriate use of those funds.
Visit AFPM’s Hurricane and Weather Event Resource Center for more information on steps being taken to ensure the safety of our members’ facilities, their employees and the communities that surround them.
Publicly owned companies, like many U.S. refineries, have a fiduciary responsibility (which is a legal obligation) to act in the best interest of their shareholders, and that extends to how companies spend their earnings. Often, earnings are spent on a combination of the following: direct dividends, stock buy back programs, paying down debt and capital investment projects.