Vale — Financial Results

Net Income Fell 15% to $2.3 Billion, but Underlying Operations Actually Improved

The headline profit drop is largely explained by a $1.1 billion asset impairment loss (a write-down of asset values on the books) tied to Valero's California refineries. Strip that out, and the company's adjusted operating income actually rose by $615 million year over year. That distinction matters: the core refining business performed better in 2025 than in 2024.

Refining — the Core Business — Had a Strong Year

Diesel margins were the biggest driver, adding roughly $1.8 billion in favorable impact, with gasoline contributing another $650 million. The company also processed more crude oil — 76,000 additional barrels per day. The main drag was a narrowing of crude oil differentials (the discount Valero pays for cheaper, lower-quality crude relative to benchmark prices), which cost about $1.7 billion combined. Still, a very solid year for the refining core.

Valero Is Exiting California, Taking a $1.1 Billion Write-Down

Valero approved a plan in March 2025 to shut down its Benicia Refinery by end of April 2026 and is evaluating options for its Wilmington refinery. The company determined the assets were no longer worth their carrying value on the books and recognized a combined $1.1 billion impairment loss. An extra ~$300 million in accelerated depreciation was also charged in 2025 as the Benicia assets wind down. California's regulatory environment has been a persistent cost and complexity burden for refining operations.

Renewable Diesel Swung to a Loss, Hit by Tariffs and a Tax Credit Overhaul

Two major policy shifts hammered this segment. First, new tariffs on imported renewable feedstocks (the raw materials used to make renewable diesel) raised costs by roughly $940 million — and also pushed up prices for domestic feedstocks as buyers competed for them. Second, the blender's tax credit (a $1.00/gallon incentive for blending renewable fuels) was replaced on January 1, 2025 by the clean fuel production credit, which covers fewer volumes and at lower values — costing approximately $675 million in lost incentive value. Higher renewable diesel sale prices helped offset some of this, but not enough.

The Company Returned $4 Billion to Shareholders While Maintaining Strong Liquidity

Valero generated substantial cash from operations and prioritized returning it to stockholders — buying back about 16.7 million shares — while still investing $1.9 billion back into the business. With $9.8 billion in liquidity and investment-grade credit ratings from all three major agencies, the balance sheet looks healthy. The board also authorized a fresh $2.5 billion buyback program in February 2026.