Why Refinery and Logistics Stocks Tumbed Today

The price of crude oil continued its freefall today. The U.S. oil price benchmark, West Texas Intermediate, fell more than 20%, closing at its lowest level in 18 years.

Usually, lower oil prices are good news for refineries, which need to buy crude so that they can turn it into gasoline and diesel. However, these aren't normal times, as demand for refined products has cratered because of the COVID-19 outbreak, which is causing governments around the world to restrict travel. That's weighing on refining margins, which have crashed 95% to their lowest levels since 2008. It's also putting pressure on the share prices of oil refiners as well as logistics companies that transport and store refined products. Among the notable decliners today were Valero Energy (NYSE: VLO), Phillips 66 (NYSE: PSX), Marathon Petroleum (NYSE: MPC), Sunoco (NYSE: SUN), and Holly Energy Partners (NYSE: HEP).