Billionaire investor Jim Mellon’s recent comments on Venezuela’s protracted oil recovery timeline have driven renewed interest in U.S. refining names with heavy crude capability, including Valero Energy. Mellon projected that Venezuela will need five to ten years to restore output to roughly three million barrels per day. He argued that until Venezuelan volumes return to market, refiners processing heavy and medium sour grades stand to capture elevated margins. In the two weeks following his remarks, shares of major U.S. refiners have rallied more than 12%, with Valero among the top performers. Trading volumes for Valero have increased by nearly 30% over the same period, suggesting heightened investor conviction in its ability to benefit from constrained supply of heavier grades.

Valero’s network of 15 refineries across the United States, Canada and the U.K. processes a broad slate of crude oils, ranging from light sweet barrels in North Dakota to heavy sour grades imported from Latin America. Over the last quarter, Valero adjusted its product yield slate to increase diesel production by five percentage points while curbing gasoline output, a shift that captured a refining margin uplift of approximately 20 cents per barrel. The company reported throughput of 3.2 million barrels per day in the third quarter, near its nameplate capacity of 3.3 million, and achieved a record utilization rate of 97%. This flexibility in crude sourcing and yield optimization has helped Valero maintain its industry-leading refining margin of over $15 per barrel despite turbulence in global oil markets.