Analogy 1: Valero is essentially a massive fuel manufacturing plant, converting crude oil into gasoline, diesel, and jet fuel, similar to the refining operations of ExxonMobil or Shell.

Analogy 2: Valero is a diverse energy provider, producing and distributing not just petroleum fuels but also renewable diesel and ethanol, similar to the product and distribution networks of the downstream divisions of BP or Chevron.

• Gasolines: Valero produces various grades of gasoline, including conventional, premium, and reformulated types for transportation.
• Diesel Fuels: The company manufactures low-sulfur, ultra-low-sulfur, and California Air Resources Board (CARB) diesel fuels.
• Jet Fuels: Valero produces specialized fuels for aircraft.
• Renewable Diesel: This is a diesel fuel produced from renewable organic materials such as animal fats and used cooking oils.
• Ethanol: Valero produces ethanol, primarily used as a fuel additive or biofuel.
• Asphalts: The company manufactures asphalt, a refined petroleum product used in paving and construction.
• Petrochemicals: Valero produces chemicals derived from petroleum or natural gas for various industrial uses.
• Lubricants and Lube Oils: These products are manufactured to reduce friction and wear in engines and machinery.
• Natural Gas Liquids: Valero also produces natural gas liquids, which are hydrocarbon mixtures obtained from natural gas processing.
• Ethanol By-products: From its ethanol production, Valero sells dry distiller grains, syrup, and inedible corn oil, primarily to animal feed customers.

Lane Riggs, President and Chief Executive Officer

Lane Riggs was appointed President and Chief Executive Officer of Valero Energy Corporation in January 2020. His leadership at Valero has been characterized by a focus on operational excellence, strategic growth, and environmental stewardship. Prior to becoming CEO, he held significant roles within the company, including Executive Vice President of Refining Operations and Engineering, Senior Vice President-Refining Operations, and Senior Vice President of Crude, Feedstock Supply, and Trading, overseeing Planning, Economics, and Development. Riggs earned a Bachelor of Science degree in chemical engineering from the University of Oklahoma and a Master of Business Administration degree with an emphasis in finance and economics from West Texas A&M University.

Homer Bhullar, Senior Vice President and Chief Financial Officer

Homer Bhullar assumed the role of Senior Vice President and Chief Financial Officer, effective January 1, 2026. In this capacity, he is responsible for leading Valero's financial management and strategy, including oversight of the company's accounting, tax, treasury, risk management, corporate development, and investor relations functions. Bhullar joined Valero in 2014, serving in various leadership positions such as Vice President-Investor Relations and Finance, Vice President of Business Development, and Director of Corporate Development. Before joining Valero, he worked as an investment banker specializing in the energy sector at J.P. Morgan and Citigroup. At J.P. Morgan, he was involved in advisory teams for the spinoff of CST Brands Inc. and the formation of Valero Energy Partners LP. He holds a bachelor's degree in economics and an MBA with a focus on investment management and energy finance, both from the University of Texas at Austin.

Gary Simmons, Executive Vice President and Chief Commercial Officer

Gary Simmons serves as Executive Vice President and Chief Commercial Officer, with oversight of Valero's crude supply and products trading, wholesale marketing, transportation, and international commercial operations groups. He previously held positions as Senior Vice President-Supply, International Operations, and Systems Optimization, and Vice President-Crude, Feedstock, Supply and Trading.

Rich Walsh, Senior Vice President and General Counsel

Rich Walsh is the Senior Vice President and General Counsel for Valero Energy Corporation. In this role, he is responsible for the company's litigation, regulatory, and employment law departments, as well as its ad valorem tax and environmental, health, and safety groups. Prior to his current position, Walsh served as Valero's Vice President and Deputy General Counsel, holding various leadership roles within the legal department. He earned his Bachelor of Arts and Juris Doctor degrees from the University of Oklahoma.

Eric Fisher, Senior Vice President Product Supply, Trading and Wholesale

Eric Fisher serves as Senior Vice President Product Supply, Trading and Wholesale, overseeing the company's product supply and trading, and global wholesale marketing operations, which include offices in London, Montreal, and Dublin. Fisher began his career with Valero in 1997 in the Corporate Law Department. He has held numerous leadership positions within the company, including Vice President of Investor Relations, President-Europe, and Senior Vice President-Wholesale Marketing and International Commercial Operations. Before joining Valero, Fisher practiced law at the firm of Fulbright & Jaworski.

Key Risks to Valero Energy (VLO)

1. Energy Transition and Decreased Demand for Transportation Fuels: Valero's core business relies heavily on the manufacture and sale of conventional transportation fuels like gasoline and diesel. The global shift towards decarbonization, increasing adoption of electric vehicles, and advancements in fuel efficiency pose a significant long-term risk to the demand for these products. As the world transitions to lower-carbon energy sources, the market for Valero's primary products could shrink, impacting refining utilization and profitability.

2. Volatile Crude Oil Prices and Refining Margins: The profitability of Valero's Refining segment is highly sensitive to the differential between crude oil input costs and the selling prices of refined products, often referred to as crack spreads. Fluctuations in global crude oil prices, driven by geopolitical events, supply and demand imbalances, and economic conditions, can significantly impact refining margins, leading to earnings volatility.

3. Environmental Regulations and Climate Change Policies: Valero operates in a heavily regulated industry. Increasing governmental and societal pressure to address climate change could lead to more stringent environmental regulations, carbon taxes, or other policies aimed at reducing greenhouse gas emissions. Such measures could increase Valero's operating costs, require substantial capital expenditures for compliance, and potentially impact the demand for its products.

The accelerating global transition towards electric vehicles and other alternative energy sources for transportation poses a clear emerging threat to Valero Energy. As demand shifts away from internal combustion engine vehicles, the need for Valero's primary products, such as conventional gasoline and diesel fuels refined from petroleum, will decline significantly over time. This trend directly impacts the core profitability and long-term viability of its large refining segment.

Valero Energy Corporation's main products and services operate within several significant addressable markets:

Transportation Fuels (Gasoline, Diesel, Jet Fuel)

• The global transportation fuel market was valued at USD 828.90 billion in 2023 and is projected to reach USD 1,103.20 billion by 2033, growing at a Compound Annual Growth Rate (CAGR) of 2.90%. Another estimate places the global transportation fuel market at USD 894.72 billion in 2025, with a projected growth to USD 1,187.31 billion by 2033 at a CAGR of 3.60%.
• North America holds a substantial portion of this market, accounting for approximately 35-38% in 2023. The U.S. transportation fuel market size was USD 261.20 billion in 2025.
• Within the transportation fuel sector, the diesel segment is estimated to have the highest global market revenue share. The U.S. diesel fuel market is estimated to reach USD 60 billion by 2031, with a CAGR of 2.5% during the 2025-2031 forecast period.

Petrochemical Products

• The global petrochemical market was valued at USD 700.10 billion in 2025 and is forecast to grow to approximately USD 1,257.50 billion by 2035, exhibiting a CAGR of 6.03%. Other estimates indicate the global market size at USD 625.42 billion in 2024, expected to increase to USD 1,149.8 billion by 2033 at a CAGR of 7%.
• In the United States, the petrochemical market was valued at USD 116.9 billion in 2024 and is projected to reach USD 210.7 billion by 2032, with a CAGR of 7.8%. Another source reported the U.S. petrochemicals market size at approximately USD 114.44 billion in 2025, with a projection to reach USD 216.85 billion by 2035 at a CAGR of 6.60%.

Renewable Diesel

• The global renewable diesel market was estimated at USD 25.8 billion in 2025 and is anticipated to grow from USD 27.3 billion in 2026 to USD 57.9 billion by 2035, achieving an 8.7% CAGR. Another report states the global market size at USD 33.91 billion in 2025, with a forecast to reach USD 50.26 billion by 2030 at a CAGR of 8.19%.
• North America held a market value of USD 12.4 billion in 2025 for renewable diesel. The U.S. renewable diesel market was valued at USD 12.07 billion in 2025 and is expected to reach approximately USD 22.99 billion by 2035, growing at a CAGR of 6.66%.

Ethanol

• The global ethanol market was valued at around USD 110.72 billion in 2023 and is projected to grow to approximately USD 176.22 billion by 2032, with a CAGR of about 5.30%. Other estimates place the global market size at USD 114.98 billion in 2025, with a forecast to reach around USD 199.40 billion by 2035, expanding at a CAGR of 5.66%.
• North America is a leading region in the global ethanol market, holding over 53% of the global market share in 2025. The U.S. ethanol market is estimated to be valued at USD 32.76 billion in 2025 and is projected to reach USD 60.66 billion by 2032, at a CAGR of 9.20%.

Valero Energy Corporation (VLO) is anticipated to experience future revenue growth over the next two to three years driven by several key factors across its segments:

1. Expansion and Optimization of Renewable Diesel and Sustainable Aviation Fuel (SAF) Production: Valero's Diamond Green Diesel (DGD) joint venture is a significant growth area. The completion and startup of the Sustainable Aviation Fuel (SAF) project at the DGD Port Arthur plant are expected to enhance long-term profitability. The company's strategic positioning in the renewable diesel market, marked by increasing DGD indicators, suggests potential to capitalize on favorable market dynamics and rising Renewable Identification Number (RIN) prices. Valero has demonstrated increased renewable diesel sales volumes, with Q3 2024 volumes being higher than the previous year. The DGD Port Arthur plant, which began operations in late 2022, continues to ramp up rates, contributing additional volumes.

2. Favorable Refining Market Dynamics and Robust Demand for Transportation Fuels: Valero is expected to benefit from improving diesel demand and widening crude oil differentials, which are projected to enhance refining margins. Long-term market dynamics appear favorable due to anticipated product demand exceeding supply, driven by announced refinery shutdowns and limited new capacity additions beyond 2025. The company has observed robust U.S. wholesale volumes, indicating strong product demand. Furthermore, the global refining industry is facing tight supply and lagging capacity additions, which, combined with steady fuel demand, could lead to lower inventories and increased pressure on operational refineries like Valero to meet demand. Valero's operational capacity allows for full utilization in a favorable North Atlantic market, with management projecting demand growth outpacing supply. Widening discounts for sour crude and increased availability of Canadian and Venezuelan crude are also advantageous for Valero's refining system.

3. Increased Ethanol Production Volumes: Valero's ethanol segment has shown a trend of increasing production volumes. Ethanol production volumes in Q3 2024, Q2 2024, Q1 2024, and Q4 2023 were consistently higher than their respective prior-year periods. This growth in production, coupled with favorable factors such as lower corn prices, contributed to higher operating income in the ethanol segment in past quarters.

Share Repurchases

• Valero's annual share buybacks amounted to $5.136 billion in 2023, $2.875 billion in 2024, and $2.598 billion in 2025.
• Total shareholder cash returns reached $4.0 billion in 2025.
• As of September 2025, the company had two repurchase programs in progress, authorizing the buyback of up to $2.811 billion in common shares, representing approximately 5.29% of its common shares.

Share Issuance

• In March 2026, Valero Energy Corporation priced a public offering of $850 million aggregate principal amount of 5.150% Senior Notes due 2036. The proceeds are intended for general corporate purposes, including the repayment, repurchase, or redemption of outstanding debentures and senior notes due in 2026.
• The company issued $650 million aggregate principal amount of 5.15% Senior Notes due 2030 in February 2025.

Capital Expenditures

• Annual capital expenditures were $911 million in 2023, $907 million in 2024, and $796 million in 2025.
• Valero anticipates capital investments of approximately $1.7 billion for 2026, with around $1.4 billion allocated to sustaining the business and the remainder for growth projects. These investments include expenditures for turnarounds, catalysts, regulatory compliance, and joint venture investments.
• The company is advancing optimization projects, such as the $230 million SEC unit optimization project at the St. Charles refinery, which is expected to commence operations in the latter half of 2026. Additionally, Valero has invested $6.0 billion in low-carbon projects as of February 2026.