Phillips 66 (PSX) is trading lower after a recent preliminary first-quarter 2026 update highlighted roughly $900 million of pre-tax mark-to-market losses tied to commodity-derivatives positions. The disclosure is weighing on sentiment because mark-to-market accounting can swing reported earnings sharply when crude and product prices move quickly, even if underlying operations remain steady.

The derivatives hit is arriving just ahead of the company’s scheduled earnings release on April 29, pushing investors to de-risk into the print and reassess near-term earnings power. While the company also provided segment-level early indicators in its filing, the headline number investors are keying on is the magnitude of the derivatives-driven loss and what it implies about risk management in a volatile tape.

Key catalysts from here include any follow-on details about hedge positioning and whether the mark-to-market loss reflects timing that could partially reverse, plus updates on refining margins, utilization and operational reliability across the system. The April 29 earnings report is expected to be the next major inflection point for the stock, particularly if management updates capital-return plans or addresses commodity-risk exposure more explicitly.