Oct 29 (Reuters) - Refiner Phillips 66 (PSX.N) , opens new tab beat Wall Street estimates for third-quarter profit on Wednesday, helped by stronger fuel margins and record volumes in its pipeline business.

Shares of the company rose 1% in premarket trade.

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U.S. refining margins have rebounded from multi-year lows, recovering after last year's slump, when profits cooled from post-pandemic highs and supply shocks triggered by Russia's invasion of Ukraine in 2022 faded.

Quarterly U.S. refinery margins on an average jumped about 25% from multi-year lows.

The recovery has helped top refiners including Valero Energy (VLO.N) , opens new tab post stronger-than-expected quarterly results.

Phillips 66's realized margin rose to $12.15 per barrel in the quarter, up about 46% from a year earlier, while the refining segment reported adjusted earnings of $430 million, compared with a loss of $67 million a year earlier.

The refiner's midstream segment, which transports products such as gasoline, diesel and natural gas liquids through its pipelines, reported adjusted earnings of $697 million, up about 4% from a year earlier.

The company said its refining segment's income was partially offset by higher environmental costs primarily associated with the planned idling of the Los Angeles Refinery.

Phillips 66 said it has ceased processing crude oil at the Los Angeles Refinery on October 16, with remaining units expected to be idled by year end.

The refiner's crude capacity utilization in the quarter was at 99%, compared with 94% from a year earlier, while turnaround expenses fell about 74% to $36 million.

It reported an adjusted profit of $2.52 per share for the three months ended September 30, compared with analysts' average estimate of $2.17 per share, according to data compiled by LSEG.

https://www.reuters.com/business/energy/phillips-66-beats-quarterly-profit-estimates-strong-refining-margins-2025-10-29/