HF Sinclair beats profit estimates as refining margins soar

By Nicole Jao and Tanay Dhumal

July 31 (Reuters) - Refiner HF Sinclair DINO.N beat Wall Street estimates for second-quarter profit on Thursday as higher refining margins in the mid-continent region helped offset lower refined product sales volumes.

Shares of HF Sinclair were up around 1.5% by 11:22 a.m. EDT.

Top U.S. refiners are posting improved results in the second quarter, rebounding from first-quarter losses as stronger-than-expected diesel margins lift earnings. Peers such as Valero Energy VLO.N and Phillips 66 PSX.N have also surpassed Wall Street estimates.

Dallas, Texas-based HF Sinclair reported second-quarter refining margins of $16.50 per barrel, up about 46% from a year ago. Refining margins for the mid-continent region jumped about 85%, to $15.52 per barrel, during the quarter.

Its adjusted profit reached $1.70 per share, compared with analysts' average estimate of $1.02 per share, according to data compiled by LSEG.

"There was a lot of concern earlier in the year that capacity growth would outshine demand growth. And really what we've seen play out over this year is that that's not happening," said Tim Goh, CEO of HF Sinclair.

"If you look at (the) longer term, the policies of this new administration are also strengthening the outlook for the refining industry."

The higher quarterly margins helped offset throughput volumes, which were down 2.4% at 660,640 barrels per day from a year earlier, while refinery utilization was down at 90.8% from 93.6% in the same period.

The lower volumes were due to turnaround activities at its Tulsa and Parco refineries in the reported quarter, the company said in a statement.