Summer is here. And if you're like me, that means road trips with the family. But this year's summer vacation may come with some sticker shock. AAA reports that the national average for a gallon of gas is $5.01. In Illinois, Nevada, and Oregon, you should expect to pay over $5.50. And in California, buckle up because the average price in the Golden State is $6.43 per gallon.
Obviously, higher prices for crude oil are behind much of the surge in prices. But so is the lack of refinery capacity. So, is now the time to buy Valero Energy Corporation (NYSE: VLO)? Let's dig in and see.
Refiners take crude oil and produce petrochemical derivatives, such as transportation fuel. Since most of their end product is gasoline, diesel, and aviation fuel, refiners were particularly hard-hit by the pandemic. As countries locked down, cars and planes sat idle, and fuel reserves surged. Refineries lowered their production; many closed for good. In 2021, U.S. refinery capacity fell for the first time in a decade.
Source Fool.com