Goldman Sachs says as Venezuelan output recovers and more barrels shift from
China to the US Gulf Coast, regional heavy-crude supply/demand will change
first. The most immediate market impact is likely on heavy vs light price
differentials, which would favor Gulf Coast refineries able to process heavier
grades. Large refiners with heavy-processing capability — Marathon Petroleum,
Valero and Phillips 66 — should gain feedstock optionality, Goldman adds.
Renewed Venezuelan heavy exports will also increase competition for Canadian
heavy crude; Goldman says that effect is already partly reflected in valuations
of some Canadian oil companies.
