(Adds refining margins, industry details)
By John Benny
July 26 (Reuters) - Two of the biggest independent oil refiners in the United States beat Wall Street profit estimates on Thursday as greater processing of cheap, light crude from West Texas helped boost margins.
Most refiners in the United States process heavy crude from Venezuela or Canada into diesel, gasoline and other products, but the U.S. shale revolution has added millions of barrels of very light crude to the supply mix.
After reporting a doubling of profit in the second quarter, Marathon Petroleum chief Gary Heminger said business prospects should stay strong “given strong global demand, wider crude differentials, and the changing dynamics of the low-sulfur fuel market.”
Revenue at both Marathon and independent refiner Valero Energy Corp surged by 22 percent and 39 percent respectively.
Marathon’s profit beat estimates for the quarter by 24 cents, while rival Valero posted a profit of $2.15 per share, ahead of expectations of $1.98 per share.
Strong crack spreads - the margin on turning crude oil into diesel, gasoline and other products - have spurred utilization rates, or the extent to which refiners are running at full capacity without downtime.
Marathon’s refining and marketing margin jumped 36 percent to $15.40, while those for Valero rose 14 percent jump.
The refiners’ earnings were also boosted by a discount on crude prices in Midland, Texas, which widened by nearly $10 a barrel against benchmark futures during the second quarter, as production in the Permian surged beyond pipeline capacity to move oil out of the region.
Total revenue and other income at Marathon rose to $22.45 billion from $18.35 billion while that at Valero jumped to $31.02 billion from $22.25 billion a year earlier.
Profit at Valero rose 54.2 percent rise compared to the same quarter a year earlier. (Reporting by John Benny in Bengaluru; Editing by Sriraj Kalluvila)