Tom Nimbley: Well, supply and demand is the answer to your question. We’ve had recovery in Jet and we are continuing to see recoveries in Jet worldwide. By the way, China is showing some significant increase in their flights. But Jet is — appears to be on the move up in 2023 and, in fact, likely could be back to pre-pandemic levels. As I said and I’m going to ask Paul Davis to comment on this but we’ve got relatively tight inventories. Obviously, we’ve had a situation where diesel distillate was very strong. So you were making a lot of distillate mainly out of gasoline but — then all of a sudden, we get to the point that Jet starts to spike because the amount of imports coming in on jet into the country have been relatively low, extremely low.
In fact, because there’s demand of other parts of the world. So it gets back to the point that Doug and others have asked the PAD 1 region has got less capacity, refining capacity than it has under the normal demand environment. that was masked by the fact that we didn’t have a normal demand environment. As we recover, all of a sudden, the capacity that’s been taken offline is becoming a fact that when you look at the conveyance and pipelines being filled from the Gulf. Paul, would you add anything to that?
Paul Davis: Yes. I mean one of the contributing factors to the Jet run-up is the winter storms that we had in the Gulf Coast and as we ended the year as we started maintenance in the Gulf. The lack of jet production from Asia has been closed on Jet since early fall and it’s just the supply and demand balancing act and eventually that type it’s coming off, as you said.
Matthew Blair: Great. And then where are you at on the outstanding environmental obligations for RINs and AB32? I think the previous number was around like $1.2 billion. And then what’s the cadence for paying that down in 2023 and 2024?
Karen Davis: Matt, the environmental credit was approximately $1.4 billion at year-end and RINs was $1.1 billion of that. We have extended our RINs payables as part of our overall working capital management while managing our program to be compliant with all of its deadlines. We turned in the 2020 vintage in December. We have the 2021 vintage secured and ready to be turned in, in March and we’re managing the 2022 vintage towards its due date in September. Remember that the renewable diesel facility is expected to produce about $500 million RINs annually and we’re going to be able to incorporate that production into our RINs management strategy when that’s up and going. So you’ll see the liability reducing, especially as the renewable diesel unit comes online and as we approach compliance deadline later in the year.
Operator: Your next question is coming from Paul Sankey from Sankey Research.
Paul Sankey: Welcome, Karen. Guys, could you just talk a bit more about people, I guess, I should say. Can you talk a bit more about turnarounds as you see it? I mean you made some very interesting comments about the structural reduction in global refining capacity — on a small cyclical basis, can you talk about your own outlook for turnarounds and also how you see the industry? I noted, Tom, there were some comments about the industry having been running very hard and having to turn around more. And I just wondered if you could help us think about 2023.
