We want to be the vehicle where we generate cash and return capital, and as people have seen that over time, that isn’t going to change regardless of what the margin environment is.
John Royall: Great. Thank you. And then I apologize ahead of time to Mike for this, but I do have another question on capture. But the commercial stuff aside, can you help us think about some of the moving pieces in the first quarter? And particularly, how should we think about the impact of the heavy maintenance in the quarter? Is this still a potential to be 100% maintenance, given you have so much maintenance and any other moving pieces that we should think about that might move you away from that 100% either direction in 1Q?
Maryann Mannen: Hey John, it’s Maryann and let me see if I can take that for you and address your question. So, first and foremost, we would say we continue to think for 2024. Our objective is to drive towards that 100%. You are absolutely right in the quarter. As we have said, we have got about $600 million, but we are touching crude units. So, we are not expecting a significant amount of negative impact on our capture, despite the fact that we are seeing that level of turnaround. Now, as you know, we do have variables that impact the capture rate from quarter-to-quarter. But right now, we are not expecting turnaround to have a substantially negative impact on that drive towards 100%.
John Royall: Great. Thank you very much.
Maryann Mannen: You’re welcome.
Operator: Our next question will come from Theresa Chen with Barclays. Your line is open.
Theresa Chen: Hi. I wanted to ask about [Technical Difficulty] including within your own system, which should be constructive for inventories going to summer, but internationally, there is quite a bit of new supply coming online. And one of your competitors has talked about 1.5 million barrels per day number. Would you agree with that? And how much do you think could be realistically utilized?
Rick Hessling: Hi Theresa, this is Rick. I will attack the new refining capacity first. So, we see that coming on later versus sooner. And when I say later, I would say second half of this year and then some over the years, when you bring on new greenfield facilities, which are being brought on, it’s been proven difficult to bring them on in a timely fashion. And these specific facilities like others, we will face challenges with logistics and supply. So, I won’t specifically comment on the 1.5 million barrels, but I will say we believe it will be later versus earlier. And then for the demand piece specifically, certainly, you have seen, as you referenced, utilization even here recently down 7% in the last week due to turnarounds and weather-related events.
When we look at that and look going forward, we are continuing to see steady demand. As Mike mentioned in his opening remarks, our export book on gas and diesel has been very solid. It was solid in 2023, and we are off to a very good start in ‘24. So, when we look at all of this together, we see it setting up very well, Theresa, for a very supportive spring and summer season.
Mike Hennigan: Theresa, it’s Mike. I will just add. I mean it’s pretty well documented. I mean last year, oil demand globally was over 2 million barrels a day. I know some of the forecasters are calling it 1 million barrels plus-ish. We will see how that plays itself out for this year. But I think the bigger picture, even though there has been a lot of attention, particularly to these two refineries that are coming up, as Rick mentioned later in the year. The reason we believe it’s more constructive over time is we are still believers in demand is going to continue to rise. And absent this short-term issue with some of the supply coming on, we just see it very constructive where demand is going to continue to outpace, and that’s why we think the margins will stay in an above mid-cycle of the term everybody is using.
I think at the end of the day, we will obviously keep a watch out it, and there may be some short-term variations to that. But I think part of the reason that we remain bullish is that if we look over time, we are just big believers in demand is going to stay robust. And on paper, aside from the short-term issue, we don’t see a whole lot of supply response, trying to match that. Hopefully, that makes sense to you.
Theresa Chen: Thank you.
Mike Hennigan: You’re welcome.
Operator: Thank you. Our next question will come from Ryan Todd with Piper Sandler. Your line is open.
Ryan Todd: Great. Thanks. Maybe as a follow-up on that last question, in your prepared remarks, I mean you mentioned that you, what you view as an enhanced mid-cycle environment for U.S. refiners in the coming years. I mean I think you were just talking about some of the broader global supply and demand that I think would feed into that. But can you maybe talk a little bit more about what you view as the primary drivers that uplift the margins, particularly for U.S. refiners. And when you think about the go-forward environment versus go-forward mid-cycle versus past mid-cycle, do you – what sort of uplift can, or do you think about $1 a barrel, $2 a barrel is there, and how do you underpin that in terms of kind of U.S. advantages for you and your system?
Rick Hessling: Yes. Ryan, it’s Rick. So, for U.S. advantages, they are quite significant. Mike touched on early on in his prepared remarks, we have a feedstock advantage here in North America with feedstock at our doorstep, and we have access to crude from around the world. So, we believe that’s a significant advantage. And it’s been very well documented. We have an energy advantage with the U.S. being extremely long in nat gas, and we have cheap nat gas prices. But in addition to that, when we look at our workforce, at our assets and our refinery complexity, when you start layering all of those on top of one another, Ryan, it adds up significantly to an advantage, which is why Mike referenced earlier, we believe in an enhanced mid-cycle.
