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					                                                                                MORGAN                                            STANLEY                                      RESEARCH
                                                                                NORTH                                    AMERICA


                                                                                Morgan Stanley & Co. LLC                                                              Evan Calio
                                                                                                                                                                      Evan.Calio@morganstanley.com
                                                                                                                                                                      +1 212 761 6472

                                                                                                                                                                      Ben Hur
                                                                                                                                                                      Ben.Hur@morganstanley.com
                                                                                                                                                                      +1 212 761 7827

                                                                                                                                                                      Marko Lazarevic
                June 27, 2011                                                                                                                                         Marko.Lazarevic@morganstanley.com
                                                                                                                                                                      +1 212 761 3692


Industry View   Refining & Marketing                                                                                                                                  Todd Firestone
                                                                                                                                                                      Todd.Firestone@morganstanley.com
                                                                                                                                                                      +1 212 761 7674
Attractive
                IEA Crude Stock Release: It’s
                                                                                Inside This Week in Refining                                                                                                                                                Page
                All About Crude Quality                                         Stock Release Narrows Near-term Crude Differentials
                                                                                SunCoke 3rd Amendment S-1 Highlights
                                                                                                                                                                                                                                                              2
                                                                                                                                                                                                                                                              3
                                                                                Refining Earnings Tracker                                                                                                                                                     4
                The IEA release should narrow crude differentials               Investment Perspectives                                                                                                                                                       5
                over the near-term - negative for US Refiners. We               Earnings Estimates and Equity Performance                                                                                                                                     6
                                                                                WTI Versus Waterborne Crude Oil Prices                                                                                                                                        9
                believe the IEA’s release of 60mmbbls of crude will
                                                                                Weekly EIA Petroleum Status Report                                                                                                                                           10
                temporarily alleviate the global shortage of light sweet        Weekly Crack Spread Performance                                                                                                                                              11
                crudes, incentivize NW European refiners to run and             Refining Sector: Thesis, Themes and Ratings                                                                                                                                  12
                narrow WTI/LLS (or Brent) and heavy/light crude                 Commodity and Economic Forecasts                                                                                                                                             15
                differentials in the near-term: all negative for US refiners.   Crude Oil Markets and Fundamentals                                                                                                                                           17
                The loss of ~1.5mmbpd of Libyan crude has been                  US and Global Refined Product Crack Spreads                                                                                                                                  20
                primarily offset by Arab Light (sour barrels), causing          Refined Product Fundamentals                                                                                                                                                 25
                                                                                Refining and Marketing Comparable Metrics                                                                                                                                    29
                simple refiners primarily located in NW Europe (30-40%
                                                                                Publications and Content Index                                                                                                                                               30
                of total) to run at lower utilization rates. While sweet
                                                                                Disclosures                                                                                                                                                                  32
                barrels entering the market should increase Europe runs,
                and may pressure crude diffs in the near-term, we see
                                                                                Crude Differentials Narrow Following IEA
                the impact as temporary. Global demand for light sweet
                                                                                Stock Release
                will seasonally rise and imbalances will continue until                  18
                                                                                                                                              LLS-Mars                 Brent-Urals                   Tapis-Dubai
                Libyan crude supply is restored.                                         16

                                                                                         14

                SunCoke one step closer to IPO. SXC filed the 3rd                        12

                Amendment to the S-1 on June 23. The S-1 lowered                         10
                                                                                 $/bbl




                2012 coal production by 150ktons due to Appalachia                       8

                                                                                         6
                labor shortages; however, SXC plans to achieve the
                                                                                         4
                previously guided production by mid-2013 (500ktons
                                                                                         2
                total growth). Potential impact would be ~11MM of
                                                                                         0
                EBITDA yet we are maintaining our 2012 guidance at
                                                                                                                                  May-10




                                                                                                                                                                                                                                              May-11
                                                                                                                Mar-10




                                                                                                                                                                                        Nov-10




                                                                                                                                                                                                                            Mar-11
                                                                                              Jan-10

                                                                                                       Feb-10



                                                                                                                         Apr-10



                                                                                                                                           Jun-10

                                                                                                                                                    Jul-10



                                                                                                                                                                      Sep-10

                                                                                                                                                                               Oct-10



                                                                                                                                                                                                 Dec-10

                                                                                                                                                                                                          Jan-11

                                                                                                                                                                                                                   Feb-11



                                                                                                                                                                                                                                     Apr-11



                                                                                                                                                                                                                                                       Jun-11
                                                                                                                                                             Aug-10




                this time. Other notable highlights include: (1) 2011 EPS
                and EBITDA guided to low end previous range, $90mm              Source: Bloomberg, Morgan Stanley Research

                and $165mm, respectively and (2) Harold Keene
                contingent consideration of $12mm explained ($2/ton of
                coal for produced over 150ktons in a year for 20 years).
                See page 3.

                Refiners underperform and cracks materially lower
                this week. Refiners as a group this week traded 2.5%
                lower, 1.2% below the broader energy sector and 2.3%            Morgan Stanley does and seeks to do business with
                less than the S&P 500 with most under-performance               companies covered in Morgan Stanley Research. As
                following the IEA’s release. Crack spreads from major           a result, investors should be aware that the firm may
                US regions were materially lower with Mid-Con WTI               have a conflict of interest that could affect the
                3-2-1 down 20%, Gulf Coast LLS 3-2-1 down 22%, NY               objectivity of Morgan Stanley Research. Investors
                                                                                should consider Morgan Stanley Research as only a
                2-1-1 down 19% and West Coast ANS 3-2-1 down 21%.               single factor in making their investment decision.
                Crude differentials narrowed with WTI-Brent down 25%,
                                                                                For analyst certification and other important
                LLS-Mars down 48% and LLS-Maya down 23%.                        disclosures, refer to the Disclosure Section,
                                                                                located at the end of this report.
                                                                      MORGAN                                            STANLEY                                      RESEARCH

                                                                      June 27, 2011
                                                                      Refining & Marketing




Additional Light Crude Narrows Near-term Crude Differentials
The IEA release should narrow crude differentials over the            The loss of ~1.5 mmbpd of Libyan production has created
near-term - negative for US Refiners. We believed crude oil           a global shortage of light sweet crudes IEA release is a
market was tight and availability of low sulfur barrels would         temporary solution. Light sweet crude is lower in sulfur
become a problem when demand seasonally increased into                content, higher in API gravity and produces a higher gasoline
year-end. The IEA agreed by announcing the release of crude           and distillate yield compared to heavier and more acidic crudes.
from the SPR. See, Libyan Crude Outage Will Amplify                   The lost Libyan barrels have largely been replaced by sour
Differentials (May 26, 2011). We believe the IEA’s release of         barrels (Arab Light) and this change in the global crude oil slate
60mmbbls of crude will temporarily alleviate the global               has impacted crude oil differentials and utilization. This slate
shortage of light sweet crudes, incentivize NW European               change has driven wider heavy-light and sweet-sour
refiners to run and narrow WTI-LLS (or Brent) and heavy-light         differentials and caused simple refiners to run at lower
crude differentials in the near-term: all of which are negative for   utilization. Simple refineries, with limited upgrading or
US Refiners. The loss of ~1.5mmbpd of Libyan crude has                desulfurization capacity, bid suitable replacement crudes or
been primarily offset by Arab Light (sour barrels), causing           feed-stocks to the point where it is not economic to run and now
simple refiners primarily located in NW Europe (30-40% of             with release of 60mmbbls spreads they will be able to profitably
total) to run at lower utilization rates. While sweet barrels         run – albeit for a short period of time. We believe that NW
entering the market should increase Europe runs, and may              Europe is the primary beneficiary since the majority of their
pressure crude differentials in the near-term, we see the impact      refining capacity is simple.
as temporary. Global demand for crude will seasonally rise
and imbalances will continue until Libyan supply is restored.         Exhibit 2
                                                                      Global Sweet Sour Crude Differentials Narrowing
What Happened? On June 23, the IEA announced that the 28              Since the Announcement of IEA Storage Release
                                                                                   18
member countries would release 60 mmbbls at a 2 mmbpd rate                                                                                             LLS-Mars                 Brent-Urals                   Tapis-Dubai

                                                                                   16
over the next month in an attempt to alleviate supply concerns
                                                                                   14
from Libyan outages. This is only the third time in the last 30
                                                                                   12
years that a release has been announced, the last was in 2005
                                                                                   10
following Hurricane Katrina, and the first was in late 1990 after
                                                                           $/bbl




                                                                                   8
the Iraqi invasion of Kuwait. The U.S. will release 30 mmbbls
                                                                                   6
(its commitment within the IEA framework, U.S. 50%, Europe
                                                                                   4
30%, Asia/Pacific 30%) from the Strategic Petroleum Reserve
                                                                                   2
(SPR).                                                                             0
                                                                                                                                          May-10




                                                                                                                                                                                                                                                         May-11
                                                                                                                       Mar-10




                                                                                                                                                                                                                                       Mar-11
                                                                                        Jan-10

                                                                                                              Feb-10



                                                                                                                                 Apr-10



                                                                                                                                                   Jun-10

                                                                                                                                                            Jul-10



                                                                                                                                                                               Sep-10

                                                                                                                                                                                        Oct-10

                                                                                                                                                                                                 Nov-10

                                                                                                                                                                                                          Dec-10

                                                                                                                                                                                                                   Jan-11

                                                                                                                                                                                                                              Feb-11



                                                                                                                                                                                                                                                Apr-11



                                                                                                                                                                                                                                                                  Jun-11
                                                                                                                                                                     Aug-10




Exhibit 1
SPR Release Increases Waterborne Crude Supply                         Source: Bloomberg, Morgan Stanley Research

                                                                      Exhibit 3
                                                                      Global Refining Complexity- Refiners Still Need
                                                                      Sweet Crude to Operate
                                                                                                              12.0


                                                                                                              10.0
                                                                                          Nelson Complexity




                                                                                                               8.0


                                                                                                               6.0


                                                                                                               4.0


                                                                                                               2.0


                                                                                                               0.0
                                                                                                                                United             Other N.                   Europe              South                      Asia-                Africa
                                                                                                                                States             America                                       America                    Pacific

                                                                      Source: Company data, Morgan Stanley Research
Source: Department of Energy, Morgan Stanley Research




                                                                                                                                                                                                                                                                           2
                                                                   MORGAN        STANLEY       RESEARCH

                                                                   June 27, 2011
                                                                   Refining & Marketing




SunCoke 3rd Amendment S-1 Highlights
SunCoke one step closer to IPO. SXC filed the 3rd                  Impact- None, MS earnings are already on the low end of
Amendment to the S-1 on June 23. The S-1 lowered 2012 coal         guidance ~$90mm.
production by 150ktons due to Appalachia labor shortages;
however, SXC plans to achieve the previously guided                4. Harold Keene contingent consideration explained.
production by mid-2013 (500ktons total growth). Potential          (Page 57) Harold Keene (HKCC) contingent consideration
impact would be ~11MM of EBITDA yet we are maintaining our         ($12mm) explained. SUN purchased HKCC last year for
2012 guidance at this time. Other notable highlights include:      $40mm face value plus $12mm working capital plus contingent
(1) 2011 EPS and EBITDA guided to low end previous range,          consideration. Contingent consideration requires SXC to pay
$90mm and $165mm, respectively and (2) Harold Keene                the former owners $2/ton of coal for each ton produced from
contingent consideration of $12mm explained ($2/ton of coal        the real or leased property acquired from HKCC if production
for produced over 150ktons in a year for 20 years).                levels exceed 150ktons in a calendar year for a period of 20
                                                                   years or until full exhaustion, whichever comes sooner.
Notable Highlights from SXC S-1, Amendment No. 3
                                                                   Impact- more color but no impact to our estimates.
1. 2012 met coal production guided lower by 150ktons.
(Page 2) 2012 production guided lower based on tight               Other notable. (Page 8.) Debt-for-equity exchange. The
Appalachian labor market by 150ktons and SXC will meet             company is not conducting an out of the ordinary process that
500kton run rate by mid 2013. This is a change from previously     affects the tax-free structure. Debt for exchange is a process
expected 500ktons rate by 2012.                                    where SUN will lend equity (portion of ownership) to Credit
                                                                   Suisse (underwriter and debt exchanger) for debt during the
Impact. Lower production; however, we are retaining our 2012       offering and then once the transaction (IPO) has cleared, SUN
EBITDA estimate of $300mm (not including additional surface        debt will be retired and they will receive the cash proceeds from
mining) that is based on prior SUN guidance (from 4Q10) of         IPO. Those cash proceeds will be retained at SUN tax-free.
$280-300mm EBITDA and $160-180mm earnings. We believe              SXC is also planning $700M debt offering with $575MM of
that 2012 estimates are either lower on cost per ton or higher     proceeds to SUN.
on met coal sales per ton. Also, note that the SXC debt offering
has not changed, it remains at $700mm with $575mm returning
to SUN parent.

2. Unknown surface mining partner named – Revelation
Energy. (Page 2) The unknown partner for the additional
adjacent surfacing mining was named- Revelation Energy.
The company had previously stated that 1.3mtons of additional
met coal was to be mined over a three year time frame and did
not disclose the partner.

Impact. None, MS estimates remains 500ktons per year in
2012 and 2013 followed by the remainder in 2014. We believe
that 2012 incremental EBITDA remains at ~$50mm based on
$175/ton revenue less $75/ton opex= 175-75=100x500ktons=
~$50mm (assumed D&A added back in the math).

3. SunCoke guidance for 2011 on the low end of
previously stated guidance. (Page31). SUN withdrew
February guidance for SunCoke and guided Coke earnings
and EBITDA to bottom end of the range, or moderately lower
(given on 4Q10 earnings call). This would imply $165mm of
EBITDA and $90mm of earnings.




                                                                                                                                  3
                                                                                       MORGAN        STANLEY       RESEARCH

                                                                                       June 27, 2011
                                                                                       Refining & Marketing




Morgan Stanley Quarterly Earnings Tracker & Revised Estimates
Exhibit 4
Morgan Stanley Earnings Tracker: illustrative 2Q11 EPS estimates using current QTD and current week of crack
spreads and crude oil differentials compared to our current estimates and Street consensus

                                      QTD Extrapolated          QTD Realized + Last Wk Extrapolated              MS Estimates         Consensus
                      $1.60

                      $1.40

                      $1.20
  2Q11 EPS Estimate




                      $1.00

                      $0.80

                      $0.60

                      $0.40

                      $0.20

                      $0.00
                                      ALJ                  DK                SUN                 TSO                 VLO                WNR
Source: Bloomberg, Company data, Morgan Stanley Research




                      •   Estimates Converging As Quarter Winds Down. Our estimates have moved closer to both Street consensus as well as
                          in-line with our earnings tracker as estimates are marked to market. We are currently an average 2% above consensus
                          estimates, while our earnings tracker shows 3% upside to consensus estimates on both a current QTD implied EPS
                          estimates and QTD + last week extrapolated estimates. We see most EPS upside for Mid-Con refiners with WNR and DK
                          tracking most above our and Street estimates. We also see marginal upside for complex refiners VLO and TSO due to
                          higher sweet-sour and heavy-light crude oil differentials, although weekly data have been moving down from highs as
                          underlying Gulf Coast and West Coast crack spreads contract.

                      •   Current Refining Indicators. Upside to our tracking estimates is primarily led by wider WTI discounts to waterborne crude
                          oils, benefitting Mid-Con refiners. The differentials lead upside for Mid-Con refiners, which are able to access discounted
                          WTI crude oil, while complex refiners benefit from wider sweet-sour and heavy-light spreads. In line with seasonal trends,
                          crack spreads have pulled back since early May highs.

                      •   Methodology. Our Refining Earnings Tracker is an illustrative look at current quarterly earnings based on realized spot
                          market crack spreads. We run over 10 commodity variables through our earnings models, including regional product crack
                          spreads and crude oil differentials, updated each week. We show both 2Q11 EPS implied by realized QTD prices
                          extrapolated for the entire quarter as well as QTD margins applied for the days realized in the quarter with last week’s crack
                          spreads extrapolated for the remainder.



                                                                                                                                                      4
                                                                                                                                                                                       MORGAN        STANLEY     RESEARCH

                                                                                                                                                                                       June 27, 2011
                                                                                                                                                                                       Refining & Marketing




Investment Perspectives
Exhibit 5                                                                                                                                                                              Weekly DOE report shows higher utilization and modestly
Weekly Equity Performance                                                                                                                                                              weaker demand. Refinery utilization increased 3.1% this
                                                                                                                                                           WNR, 7.3%                   week to 89.2% with Mid-Con (PADD 2) utilization at 5-year
                                                                                                                                                                                       highs (97.1%) shy of all-time highs 103.9%. Crude oil stocks
                                                                                                                        DK, 2.7%
                                                                                                                                                                                       decreased 1.8 mmbbls this week, as higher utilization drew
                                                                                                                       MLP's, 2.4%                                                     down stocks despite higher imports, while stocks fell in all
                                                                                                       CVR, 0.9%
                                                                                                                                                                                       regions except PADD 2 (Cushing stocks rose modestly at 0.2
                                                                                                                                                                                       mmbbls), despite the sharp increase in utilization. Refined
                                                                                             S&P 500, 0.1%
                                                                                                                                                                                       product stocks increased 4.8 mmbbls this week, in-line with
                                                                                           SUN, 0.0%                                                                                   5-year average trends, while total implied product demand rose
                                                                                                                                                                                       231 mbpd from last week and down 440 mbpd from last year
                                                                      E&P, -0.5%
                                                                                                                                                                                       (-2.7% YoY on a 4-week avg. basis). Gasoline implied demand
                                                                TSO, -0.8%                                                                                                             fell 0.5% WoW, with stocks also declined 500 mbbl, as imports
                                                              ALJ, -1.0%
                                                                                                                                                                                       dropped over 20% this week. Implied demand for distillate fuel
                                                                                                                                                                                       implied demand fell 4.1% as stocks increased 1.2 mmbbl. Jet
                                                     Oil Svcs, -1.3%
                                                                                                                                                                                       fuel implied demand rose 19.4% WoW, while other refined
                                                     Energy, -1.6%                                                                                                                     products fell 4.4% WoW, led lower by propane, propylene, and
                                                    NES1V (EU), -                                                                                                                      other oils categories.
                                                       1.8%

                                           Int. Oil, -2.4%                                                                                                                             US House Energy and Commerce Committee approves bill
                                    US R&M, -2.8%
                                                                                                                                                                                       to pressure White House on Keystone XL decision. On
                                                                                                                                                                                       Thursday, the House Energy Committee approved HR1238 by
                                  PPHN (EU), -2.9%
                                                                                                                                                                                       a vote of 33-13 that would compel the White House to make a
                                   VLO, -4.1%                                                                                                                                          decision on Keystone XL’s cross-border application. The bill
                                                                                                                                                                                       moves the House floor for vote post July 4.
                                  HOC, -4.4%


                     FTO, -5.0%                                                                                                                                                        PetroChina gets approval for refinery/petrochemical
 SRS (EU), -8.5%
                                                                                                                                                                                       project. Local news sources report PTR received approval for
                                                                                                                                                                                       a 400 mbpd refinery and 1.2 MMtpa plant in at Taizhou in
 -10%                                        -5%                                         0%                                              5%                              10%           Zhejiang province, with PTR the majority owner (51%) along
Source: FactSet, Morgan Stanley Research, From June 17 to June 24, 2011                                                                                                                with RDS (24.5%) and Qatar Petroleum (24.5%). The project is
                                                                                                                                                                                       expected to cost $12.4 Bn and was initially expected to be
Exhibit 6                                                                                                                                                                              completed before 2015 when first announced in May 2008.
Historical Refining Performance Versus Market
                                                                       Refining           Energy                       S&P 500                                                         Total sells retail marketing assets in UK, while Shell buys
  180
                                                                                                                                                                                       UK retail. Total announced the sale of 810 retail stations,
  160
                                                                                                                                                                                       heating oil business and associated logistics to a consortium
  140
                                                                                                                                                                                       led by Snax 24. The company continues to be involved in a
  120
                                                                                                                                                                                       process to sell its Lindsey UK refining asset. In a separate
  100
                                                                                                                                                                                       transaction, Shell purchased 254 retail stations from a
   80                                                                                                                                                                                  consortium led be Snax 24.
   60

   40                                                                                                                                                                                  Operational Update: LatAm refineries continue to struggle.
   20                                                                                                                                                                                  PDVSA’s 245 mbpd Curacao refinery failed to restart due to
   0                                                                                                                                                                                   operational issues and PBR’s Reduc 141 mbpd refinery is
        06/23/2006




                     12/22/2006




                                       06/22/2007




                                                         12/21/2007




                                                                            06/20/2008




                                                                                          12/19/2008




                                                                                                          06/19/2009




                                                                                                                            12/18/2009




                                                                                                                                              06/18/2010




                                                                                                                                                            12/17/2010




                                                                                                                                                                          06/17/2011




                                                                                                                                                                                       offline for a planned turnaround.

Source: FactSet, Morgan Stanley Research




                                                                                                                                                                                                                                                   5
                                                                                 MORGAN            STANLEY             RESEARCH

                                                                                 June 27, 2011
                                                                                 Refining & Marketing




Consensus EPS Revisions and Short Interest
Exhibit 7                                                                        Exhibit 9
2011 Consensus EPS Revisions (Past 3 Months)                                     2012 Consensus EPS Revisions (Past 3 Months)

                                                                   ALJ, 350.5%                                                                         FTO, 38.1%



                            FTO, 52.5%                                                                                                           ALJ, 33.7%



                            TSO, 51.0%                                                                                                   WNR, 23.9%



                            DK, 49.3%                                                                                                 HOC, 21.6%



                          HOC, 39.9%                                                                                           DK, 15.5%


                          WNR, 38.2%                                                                                          TSO, 14.4%


                         VLO, 35.1%                                                                                         VLO, 11.7%


 SUN, -64.3%                                                                      SUN, -16.6%


 -100%            0%           100%         200%            300%        400%      -20%        -10%        0%       10%          20%        30%        40%     50%
Source: FactSet, Morgan Stanley Research
                                                                                 Source: FactSet, Morgan Stanley Research

Exhibit 8
                                                                                 Exhibit 10
2011 Consensus EPS Revisions (Past 1 Month)                                      Short Interest as a % Shares Outstanding

                                                               HOC, 13.6%                                                                             WNR, 20.5%


                                                WNR, 4.9%                                                             TSO, 10.4%


                                            ALJ, 4.2%                                                      SUN, 6.6%


                                           FTO, 3.9%                                                      HOC, 6.0%



                                    TSO, 0.7%                                                        FTO, 4.3%



                   VLO, -0.3%                                                                 VLO, 2.3%


                                                                                              DK, 2.2%
                DK, -1.8%


                                                                                              ALJ, 2.1%
   SUN, -5.9%

                                                                                   0%              5%            10%             15%             20%          25%
 -10%           -5%            0%           5%          10%            15%
                                                                                 Source: FactSet, Morgan Stanley Research
Source: FactSet, Morgan Stanley Research




                                                                                                                                                                    6
                                                                                 MORGAN        STANLEY       RESEARCH

                                                                                 June 27, 2011
                                                                                 Refining & Marketing




Morgan Stanley and Consensus Estimates
Exhibit 11
Morgan Stanley EPS Estimates Versus Consensus
                                            1QA        2QE      3QE      4QE                                         YoY EPS Growth
             Company                      Mar-11     Jun-11   Sep-11   Dec-11         2010A      2011E   2012E     '11 vs '10 '12 vs '11
             Refiners
             ALJ                            0.31      0.42      0.02    (0.12)        (2.41)      0.64    (0.16)         NA       -125%
              FS Consensus                  0.31      0.42      0.09    (0.08)        (2.41)      0.72     1.04          NA         45%
              MS vs. Consensus                         0%      -74%      57%                     -10%    -115%
             DK                             0.31      0.71     0.36     0.16          (0.36)      1.54    1.07           NA        -31%
              FS Consensus                  0.31      0.56     0.25     0.14          (0.36)      1.31    0.97           NA        -26%
              MS vs. Consensus                        28%      44%      18%                       18%     10%
             FTO
              FS Consensus                  1.32      1.15     0.81     0.55           0.36       3.93    3.10           NA        -21%
              MS vs. Consensus                          NA       NA       NA                        NA      NA
             HOC
              FS Consensus                  1.58      2.14     1.74     1.11           1.94       6.80    6.25         250%         -8%
              MS vs. Consensus                          NA       NA       NA                        NA      NA
             SUN                           (1.01)      0.36    0.93     0.73           1.79       1.36    3.27          -24%       140%
              FS Consensus                 (1.01)      0.57    0.73     0.30           1.79       0.66    2.30          -63%       247%
              MS vs. Consensus                        -37%     26%     145%                      106%     42%
             TSO                            0.74      1.26     1.13      0.33         (0.29)      3.46     2.52          NA        -27%
              FS Consensus                  0.74      1.16     0.85      0.37         (0.29)      3.15     2.79          NA        -12%
              MS vs. Consensus                         8%      32%      -11%                      10%     -10%
             VLO                            0.18      1.48     1.24      0.49          1.62       4.00     2.97        147%        -26%
              FS Consensus                  0.18      1.40     1.16      0.62          1.62       3.62     3.78        124%          4%
              MS vs. Consensus                         5%       6%      -21%                      10%     -21%

             WNR                            0.17      1.16     0.70      0.46         (0.11)      2.50     1.98          NA        -21%
              FS Consensus                  0.17      1.08     0.78      0.53         (0.11)      2.67     2.45          NA         -8%
              MS vs. Consensus                         8%       -9%     -13%                       -6%    -19%
             Integrated Oil
             CVX                            3.09      3.72     3.68     3.66           9.39      14.15   14.52           51%         3%
               FS Consensus                 3.09      3.44     3.30     3.19           9.39      12.74   12.84           36%         1%
               MS vs. Consensus                        8%      12%      15%                       11%     13%
             COP                            1.82      2.34     2.17     2.03           5.92       8.36    8.50           41%         2%
              FS Consensus                  1.82      2.22     2.16     2.06           5.92       8.16    8.68           38%         6%
              MS vs. Consensus                         6%       0%       -1%                       2%      -2%
             XOM                            2.14      2.46     2.47     2.56           6.22       9.62   10.32           55%         7%
              FS Consensus                  2.14      2.26     2.18     2.21           6.22       8.67    8.88           39%         2%
              MS vs. Consensus                         9%      13%      16%                       11%     16%
             HES                            1.82      2.01     2.29     2.29           5.14       9.59    9.60           87%         0%
              FS Consensus                  1.82      2.08     1.99     1.92           5.14       7.74    8.08           50%         4%
              MS vs. Consensus                         -4%     15%      19%                       24%     19%
             MRO                            1.65      2.09     1.74     1.60           3.65       6.83    6.76           87%        -1%
              FS Consensus                  1.65      1.77     1.53     1.38           3.65       6.28    6.20           72%        -1%
              MS vs. Consensus                        18%      14%      16%                        9%      9%
             MUR                            1.38      1.77     2.09     2.23           4.13       7.47    9.25           81%        24%
              FS Consensus                  1.38      1.69     1.95     1.98           4.13       6.73    7.82           63%        16%
              MS vs. Consensus                         5%       7%      12%                       11%     18%
             OXY                            1.96      2.56     2.60     2.62           5.72       9.51   11.17           66%        17%
              FS Consensus                  1.96      2.17     2.20     2.20           5.72       8.61    9.72           51%        13%
              MS vs. Consensus                        18%      18%      19%                       10%     15%
Source: FactSet, Morgan Stanley Research estimates




                                                                                                                                           7
                                                                                             MORGAN         STANLEY             RESEARCH

                                                                                             June 27, 2011
                                                                                             Refining & Marketing




Comparative Performance Table
Exhibit 12
Global Refining – Equity Performance
                          FDS              6/24/2011   52-wk    52-wk    % Below % Above         Last     Last       Last 3    Last 6   Last 12     YTD
                         Ticker    Curr.       Price    High     Low      52W-HI 52W-LO          Week    Month      Months    Months    Months      2011      2010      2009

Indices
  S&P 500                 SP50      USD     1,268.45 1,370.58 1,010.91     (7.5%)   25.5%       (0.2%)    (3.6%)     (3.1%)     0.9%     18.1%      0.9%     12.8%     23.5%
  Energy                 SPN01      USD       527.05   598.02   371.08    (11.9%)   42.0%       (1.3%)    (4.6%)     (8.5%)     5.0%     34.2%      4.0%     17.9%     11.3%
  Oil Services             OIH      USD       140.91   167.37    93.36    (15.8%)   50.9%       (0.8%)    (5.2%)    (11.9%)     1.6%     45.0%      0.3%     18.2%     61.2%
  Integrated Oil         SPN25      USD       493.68   561.29   354.31    (12.0%)   39.3%       (2.2%)    (4.6%)     (7.2%)     5.7%     31.2%      5.2%     15.4%     (4.0%)
  US Refining            SPN35      USD       482.29   599.87   310.85    (19.6%)   55.2%       (2.6%)    (6.5%)    (13.9%)     8.6%     40.6%      7.8%     42.5%    (17.8%)

Commodities
 Crude Oil (WTI)     CL00-NYME USD            91.02    114.00    71.63    (20.2%)    27.1%      (2.1%)   (8.6%)     (13.8%)    (0.5%)    19.0%     (0.4%)    15.1%     77.9%
 Crude Oil (Brent)   BRN00-IEPA USD          107.26    126.66    70.77    (15.3%)    51.6%      (5.3%)   (4.7%)      (7.2%)    13.8%     40.3%     13.2%     21.6%     70.9%
 Natural Gas (HH) NG00-NYME USD                4.19      4.92     3.43    (14.8%)    22.2%      (3.1%)   (4.5%)      (1.2%)     2.7%    (11.7%)    (5.2%)   (20.1%)    (2.2%)
 Gulf Coast 3:2:1               USD           22.86     29.71     3.99    (23.1%)   473.3%      (7.9%)   11.5%       17.5%    107.2%    161.7%    142.6%     85.7%    (35.8%)
 Northeast 3:2:1                USD           26.21     29.96     6.19    (12.5%)   323.2%      (5.9%)   13.5%       31.1%     81.2%    126.5%    109.5%     86.6%    (22.3%)
 West Coast 3:2:1               USD           11.21     25.99     6.14    (56.8%)    82.6%     (23.5%)   (8.8%)     (41.5%)   (18.5%)   (39.7%)    (6.3%)     3.8%    (59.2%)
 Mid-Continent 3:2:1            USD           26.82     33.45     6.60    (19.8%)   306.7%      (5.0%)   (1.4%)      24.1%    124.9%    122.3%    149.5%    109.6%    (55.2%)

US Refiners
 Alon USA Energy         ALJ        USD       10.22     15.58     4.77   (34.4%)    114.3%       1.3%    (11.2%)    (16.6%)    73.5%     58.0%     70.9%    (12.6%)   (25.2%)
 Delek US Holding         DK        USD       14.01     15.41     6.22    (9.1%)    125.2%       4.9%     (2.4%)      8.8%     91.4%     87.6%     92.4%      6.9%     28.7%
 Frontier Oil            FTO        USD       28.68     32.85    11.38   (12.7%)    152.0%      (4.7%)    (1.1%)      6.2%     62.4%    101.5%     59.2%     49.6%     (4.7%)
 Holly Corp              HOC        USD       59.81     68.26    24.35   (12.4%)    145.6%      (4.4%)    (1.0%)      6.3%     50.0%    115.3%     46.7%     59.1%     40.6%
 Sunoco                  SUN        USD       39.15     46.98    32.00   (16.7%)     22.3%       0.6%     (0.2%)    (12.9%)    (1.8%)    13.4%     (2.9%)    54.4%    (39.9%)
 Tesoro                  TSO        USD       20.84     28.74    10.40   (27.5%)    100.4%      (0.1%)   (11.4%)    (19.9%)    13.8%     70.7%     12.4%     36.8%      2.9%
 Western Refining        WNR        USD       16.24     19.50     4.01   (16.7%)    305.0%       7.3%      0.9%      (1.3%)    57.8%    194.7%     53.5%    124.6%    (39.3%)
 Valero Energy           VLO        USD       23.18     31.12    15.49   (25.5%)     49.6%      (3.8%)   (10.3%)    (19.5%)     0.7%     28.3%      0.3%     38.0%    (22.6%)
 CVR Energy              CVI        USD       22.79     24.89     6.71    (8.4%)    239.6%       1.9%     14.0%       7.6%     54.8%    187.4%     50.1%    121.3%     71.5%

Europe Refiners
 Petroplus Holdings    PPHN-CH      CHF       11.85     17.87     9.12    (33.7%)   29.9%       (2.9%)    (9.9%)    (21.5%)    (5.3%)   (29.9%)    (3.8%)   (35.3%)   (1.6%)
 Saras                   SRS-IT     EUR        1.41      2.09     1.31    (32.7%)    7.4%       (7.4%)   (15.9%)    (22.7%)   (12.1%)   (20.8%)   (10.7%)   (28.0%)   (8.9%)
 Neste                 NES1V-FI     EUR       10.26     14.74    10.19    (30.4%)    0.7%       (3.6%)   (12.7%)    (26.1%)   (15.6%)   (17.5%)   (14.1%)    (3.8%)   17.4%
 ESG                     ERG-IT     EUR        9.06     10.74     8.92    (15.7%)    1.5%        0.1%     (0.1%)     (9.3%)   (13.3%)    (7.4%)   (13.3%)     8.0%    13.7%
 Galp                   GALP-PT     EUR       14.82     15.91    11.90     (6.9%)   24.5%       (0.8%)     5.0%      (2.3%)     2.3%     20.0%      3.3%     18.7%    68.2%
 OMV                    OMV-AT      EUR       28.25     34.76    23.69    (18.7%)   19.2%       (1.2%)    (0.9%)     (8.9%)    (6.7%)    11.2%     (8.5%)     1.3%    64.0%
 MOL                    MOL-HU      HUF      21,400    25,715   18,120    (16.8%)   18.1%       (3.6%)    (8.2%)    (10.8%)     4.5%     14.3%      2.9%     22.3%    72.2%
 Tupras                TUPRS-TR      TL       39.20     53.50    28.75    (26.7%)   36.3%       (1.8%)   (10.5%)    (11.3%)    (1.5%)    25.4%      1.6%     29.7%    83.6%
 PKN Orlen              PKN-PL      PLN       51.60     58.85    35.06    (12.3%)   47.2%       (2.3%)     0.6%      (0.8%)     5.7%     38.2%     12.7%     34.9%    31.9%

Asia Refiners
 Reliance Industries   500325-IN INR         870.40 1,187.00    829.00   (26.7%)      5.0%       0.2%     (4.9%)    (13.8%)   (17.7%)   (17.2%)   (17.8%)    (2.9%)    77.1%
 S-oil                 010950-KR KRW        136,500 170,000     51,300   (19.7%)    166.1%      (9.0%)    (3.5%)     (9.0%)    52.2%    149.5%     47.6%     71.3%    (12.2%)
 Showa Shell             5002-JP JPY            736      912       600   (19.3%)     22.7%       0.1%     (0.1%)     (6.1%)    (2.3%)    10.3%     (1.1%)    (1.6%)   (13.7%)
 HPCL                  500104-IN INR         392.50   555.45    307.00   (29.3%)     27.9%       2.6%      8.6%      17.4%     (3.8%)    11.2%      0.3%      0.2%     43.3%
 Caltex                  CTX-AU  AUD          11.03    16.44      8.95   (32.9%)     23.2%      (3.1%)   (21.0%)    (28.0%)   (23.4%)     6.6%    (23.2%)    54.5%     29.3%
 Esso                   ESSO-TH THB           10.80    14.00      6.15   (22.9%)     75.6%      (1.8%)   (14.3%)     (0.9%)    44.0%     72.8%     35.8%     25.2%     18.7%
Source: FactSet, Morgan Stanley Research




                                                                                                                                                                           8
                                                                                       MORGAN                                STANLEY                              RESEARCH

                                                                                       June 27, 2011
                                                                                       Refining & Marketing




WTI Versus Waterborne Crude Oil Prices
We believe wider differentials at Cushing are secular,                                 Exhibit 14

rather than a seasonal anomaly. While we expect that                                   Front Month WTI and WTI Time spreads ($/bbl)
current record spreads of $11-20/bbl will abate, we believe                             $160


secular pressures will drive WTI-Brent differentials to average                         $140


$8-10/bbl in 2011, versus historical parity. We believe growing                         $120

production volumes moving through PADD II from Canada and                               $100

US Lower 48 unconventional oil resource will exceed takeaway                             $80

capacity into 2013 and pressure pricing at Cushing, Oklahoma.                            $60

Additional refining capacity, higher refining utilization, reversal                      $40

of pipelines, new storage capacity at Cushing and, eventually,                           $20

new pipeline capacity to the Gulf will not balance the market                             $0
until 2013 and truck, rail, and barge will require in excess of $10




                                                                                                  Jul-08



                                                                                                               Oct-08



                                                                                                                               Jan-09



                                                                                                                                              Apr-09



                                                                                                                                                        Jul-09



                                                                                                                                                                      Oct-09



                                                                                                                                                                                  Jan-10



                                                                                                                                                                                             Apr-10



                                                                                                                                                                                                         Jul-10



                                                                                                                                                                                                                           Oct-10



                                                                                                                                                                                                                                            Jan-11



                                                                                                                                                                                                                                                         Apr-11
spread to arbitrage the market.
                                                                                         $2                                                                                                            First Month less Second Month

Exhibit 13                                                                               $0

Mid-Con Crude Oil Prices                                                                 ($2)

                                                                                         ($4)

                                                                                         ($6)
                                                                                                 Jul-08



                                                                                                             Oct-08



                                                                                                                              Jan-09



                                                                                                                                             Apr-09



                                                                                                                                                        Jul-09



                                                                                                                                                                      Oct-09



                                                                                                                                                                                  Jan-10



                                                                                                                                                                                             Apr-10



                                                                                                                                                                                                         Jul-10



                                                                                                                                                                                                                           Oct-10



                                                                                                                                                                                                                                            Jan-11



                                                                                                                                                                                                                                                         Apr-11
                                                Clearbrook

                                                                                       Source: Bloomberg, Morgan Stanley Research

                                                                                       Exhibit 15
                                    Bakken 95.83
                                                                                       WTI Differential to Brent Crude Oil ($/bbl)
                           WCS 69.33                                                    $10
                           Hardisty, Canada
                                                                                         $5
                                                      WTI 91.66              Chicago
                                                                                         $0

                                                                                        ($5)

                                                     Brent 110.52                      ($10)


                                                                                       ($15)

                                                                                       ($20)

                                                                   Patoka              ($25)
                                                                                               Jul-08



                                                                                                           Oct-08



                                                                                                                             Jan-09



                                                                                                                                             Apr-09



                                                                                                                                                        Jul-09



                                                                                                                                                                      Oct-09



                                                                                                                                                                                   Jan-10



                                                                                                                                                                                              Apr-10



                                                                                                                                                                                                             Jul-10



                                                                                                                                                                                                                              Oct-10



                                                                                                                                                                                                                                                Jan-11



                                                                                                                                                                                                                                                              Apr-11
                                    WTI 90.83

                                                                                       Source: Company data, Morgan Stanley Research
                                                Cushing
                                                                                       Exhibit 16
                                                                                       WTI Forward Prices ($/bbl)
                                                Eugene Island 101.83                                                                           Jun-24            Last Week                  Last Month                     Last Year
                                                                                        110
        WTI 90.43

                                      Poseidon 100.33                LLS 105.83         100
               Midland

         WTS 89.73                                                                       90
                                                                         St. James
                                    Beaumont              Houna              Empire
                         Maya 95.20                               Clovelly
                                                 Mars 102.83                             80
                         Mexico, LatAm
                                                                    HLS 106.83
                                                                                         70
                                                                                                    0      6            12              18       24     30       36            42  48        54         60            66               72      78        84            90
Source: Bloomberg, Morgan Stanley Research; prices as of June 24, 2011                                                                                                          Months

                                                                                       Source: Bloomberg, Morgan Stanley Research




                                                                                                                                                                                                                                                                            9
                                                                                     MORGAN          STANLEY         RESEARCH

                                                                                     June 27, 2011
                                                                                     Refining & Marketing




Weekly DOE Petroleum Status Report
Exhibit 17
Crude Oil and Refined Product Statistics, Week Ending June 17
                     Crude Oil Inventories (MMbbl)                     Crude Oil Flows (mbpd)                         Refinery Inputs (mbpd)
                                                                                    Oil  Domestic                      Crude Oil Utlization       Utlization
                     This Wk. Last Wk.            Chg %                       Imports Production                           Inputs         (%)      Last Wk.
PADD 1                   12.6    12.8             -1.9%           PADD 1        1,305                       PADD 1         1,207        75.9           63.9
PADD 2                   98.7    97.9              0.8%           PADD 2        1,374                       PADD 2         3,591        97.1           94.3
PADD 3                 182.0    183.9             -1.0%           PADD 3        4,999                       PADD 3         7,423        89.5           86.6
PADD 4                   14.5    14.9             -2.1%           PADD 4          312                       PADD 4           545        88.1           95.2
PADD 5                   56.0    56.1             -0.2%           PADD 5        1,160                       PADD 5         2,511        85.9           84.4
Total US               363.8    365.6             -0.5%           Total US      9,150       5,650           Total US      15,278        89.2           86.1
Cushing, OK              38.0    37.8              0.7%           Last Week     8,638       5,643           Last Week     14,869        86.1
SPR                    726.5    726.5              0.0%           Last Year    10,112       5,501           Last Year     15,191        89.4

                                                              Crude and Refined Product Implied Demand (mbpd)
                         Finished                 Reform-                      Total      Total                         > 15 ppm                  Propane,
                          Motor                    ulated     Conventional  Kerosene   Distillate   < 15 ppm            Distillate    Residual   Propylene,
               Crude Oil Gasoline                 Gasoline     Gasoline      Jet Fuel     Fuel    Distillate Fuel          Fuel       Fuel Oil   Other Oils
Total US        15,043    9,579                    3,056         6,523        1,596      4,273        4,050                224          903          870
vs. Last Week    1.9%     -0.5%                    -0.2%         -0.7%        19.4%      -4.1%        -4.6%               5.7%         8.3%        -14.8%
vs. Last Month   2.1%      3.8%                     1.1%         5.2%          2.8%      -8.2%        -8.1%              -10.0%        8.0%        -10.1%
vs. Last Year   -1.8%      1.9%                     2.4%         1.7%         16.1%      -3.8%        -3.3%              -12.5%        20.2%       -10.9%
                                                                       Refined Product Production (mbpd)
                      Total       Reform-         Conven-                       Total    <15 ppm                        >500 ppm
                      Motor        ulated          tional    Total Kerosene Distillate   Distillate 15-500 ppm           Distillate   Residual   Propane,
                     Gasoline     Gasoline        Gasoline      Jet Fuel        Fuel       Fuel     Distillate Fuel        Fuel       Fuel Oil   Propylene
Total US              9,541        3,063           6,383          1,539        4,319      3,761           218              340          590        1,065
vs. Last Week         0.8%         0.2%            1.9%           3.2%          0.0%       0.9%        10.1%             -13.7%        9.9%        -3.0%
vs. Last Month        3.0%         1.7%            2.1%           6.1%          1.4%      -0.5%         -9.2%             41.7%        7.9%         1.7%
vs. Last Year         3.0%         2.0%            1.6%           6.9%          0.1%       4.8%        -48.2%             12.6%        27.2%       -0.3%
                                                                         Refined Product Stocks (MMbbl)
                       Total      Finished Gasoline                              Total   <15 ppm                        >500 ppm                  Propane,
                      Motor         Motor   Blending         Total Kerosene Distillate    Distillate 15-500 ppm          Distillate   Residual   Propylene,
                     Gasoline     Gasoline Component            Jet Fuel         Fuel       Fuel     Distillate Fuel       Fuel       Fuel Oil   Other Oils
Total US              214.6          58.4    156.2                 42.7         142.0       98.8            9.6            33.6          37.6      245.1
vs. Last Week         -0.2%         1.2%     -0.7%                0.2%          0.8%       0.0%           0.1%            3.6%          1.7%        1.5%
vs. Last Month         2.3%         3.2%      2.0%                9.4%           0.6%      -0.6%         -2.4%            5.6%          -1.2%       4.5%
vs. Last Year         -1.4%        -24.9%    11.7%               -8.7%          -9.5%      1.1%         -30.5%           -26.0%        -12.3%      -1.5%
                                                                         Refined Product Imports (mbpd)
                      Total       Finished Gasoline                              Total    <15 ppm                       >500 ppm                  Propane,
                      Motor        Motor    Blending         Total Kerosene Distillate    Distillate 15-500 ppm          Distillate   Residual   Propylene,
                     Gasoline     Gasoline Component            Jet Fuel         Fuel        Fuel    Distillate Fuel       Fuel       Fuel Oil   Other Oils
Total US              867           136        731                 72            122         73             0              50           405         996
vs. Last Week        -22.2%       -25.7%     -21.6%              -16.3%         -2.4%      -38.7%          NM            733.3%        55.2%       22.2%
vs. Last Month       -40.1%        -4.2%     -44.0%               -1.4%        18.4%       32.7%           NM             4.2%         -26.0%      18.0%
vs. Last Year         2.7%        -26.9%      11.1%              41.2%         -28.7%      -33.0%          NM            -19.4%        47.8%        1.2%

                                                         Refined Product Exports (mbpd)*
                           Finished               Distillate                   Residual  Propane,
                           Gasoline                 Fuel          Jet Fuel        Fuel   Propylene      Other Oils
Total US                     260                    854              79           388      139             698
vs. Last Month              30.0%                  27.3%            9.7%         2.1%     15.8%           -2.2%
vs. Last Year               67.7%                  29.8%           29.5%         4.6%     93.1%           3.4%

*exports reported second week of each month and estimated by the DOE
Source: EIA, Bloomberg, Morgan Stanley Research




                                                                                                                                                         10
                                                                                                              MORGAN               STANLEY           RESEARCH

                                                                                                              June 27, 2011
                                                                                                              Refining & Marketing




Weekly Crack Spread Performance
Exhibit 18
Weekly Refining Indicators Performance
                                                   Weekly Average                          Quarterly Average              Rolling                               % Change
                                            This Wk   Last Wk     Last Yr               QTD     Last Q    Last Yr.         5 Year               This Week vs.                 QTD vs.
                                           24-Jun-11 17-Jun-11 24-Jun-10                2Q11     1Q11      2Q10           Average        Last Wk Last Yr. Hist. Avg   1Q11     2Q10   Hist. Avg
3-2-1 Refining Margins ($/bbl)
  US Gulf Coast (WTI)                           22.86         24.58          8.87        23.02       17.18        8.67          9.97         -7%    158%     129%       34%     166%       131%
  US Gulf Coast (LLS)                            4.86          7.78          5.12         7.83        4.71        5.31          6.97        -38%     -5%     -30%       66%      47%        12%
  US Northeast (WTI)*                           26.21         27.33         10.90        25.42       19.14       10.92         12.18         -4%    140%     115%       33%     133%       109%
  US West Coast (ANS)                           11.21         14.60         18.86        16.94       17.78       16.87         17.81        -23%    -41%     -37%       -5%       0%        -5%
  US Mid-Continent (WTI)*                       26.82         28.20         11.98        27.13       19.65       11.44         12.88         -5%    124%     108%       38%     137%       111%
  Northwest Europe (Brent)                       7.15          7.78         10.54         9.86        5.89        9.76          9.76         -8%    -32%     -27%       68%       1%         1%
  Singapore (Dubai)                             16.43         16.57         12.55        18.38       15.32       11.19         14.52         -1%     31%      13%       20%      64%        27%
Global Product Cracks ($/bbl)
  US Avg. Gasoline (WTI)                        25.01         25.66         12.43        26.83       16.38       11.76          11.70        -3%    101%     114%       64%      128%      129%
  US Avg. Diesel (WTI)                          31.87         34.10         13.81        28.97       25.21       13.16          17.29        -7%    131%      84%       15%      120%       68%
  US Avg. Fuel Oil (WTI)                        11.51         12.26         (7.33)        3.22        1.38       (6.93)        (11.26)       -6%   -257%    -202%      134%     -147%     -129%
  NW Europe Gasoline (Brent)                     4.37          4.44          7.02         8.30        2.15        7.73           6.05        -1%    -38%     -28%      287%        7%       37%
  NW Europe Diesel (Brent)                      14.69         16.15         14.63        14.37       16.28       12.67          16.60        -9%      0%     -12%      -12%       13%      -13%
  NW Europe Gas Oil (Brent)                      9.12         10.70         11.98         9.55       11.25        9.64          13.66       -15%    -24%     -33%      -15%       -1%      -30%
  NW Europe Fuel Oil (Brent)                   (13.21)       (15.46)       (10.89)      (17.83)     (18.95)     (10.99)        (17.05)      -15%     21%     -23%       -6%       62%        5%
  Singapore Gasoline (Dubai)                    15.95         14.89         12.03        17.65       13.73       11.06          13.98         7%     33%      14%       29%       60%       26%
  Singapore Naptha (Dubai)                     (10.43)       (11.75)        (2.41)       (8.46)      (4.73)      (1.35)         (2.48)      -11%    333%     320%       79%       NM       241%
  Singapore Fuel Oil (Dubai)                    (7.36)        (8.16)        (7.66)      (10.41)     (10.02)      (8.13)        (10.39)      -10%     -4%     -29%        4%       28%        0%
  Ethanol Crush Margin ($/gal)                   0.15         (0.00)         0.31        (0.04)      (0.01)       0.29           0.48        NM     -53%     -69%      260%     -115%     -109%
Crude Oil Differentials
  US-Europe (WTI/Brent)                        (18.55)       (19.74)         0.47       (14.48)     (10.75)      (0.75)        (0.81)        -6%     NM       NM        35%       NM        NM
  Sweet-Sour Spread (WTI/WTS)                    1.49          1.71          2.17         2.62        4.09        1.85          3.34        -13%    -31%     -55%      -36%       42%      -22%
  Light-Heavy Spread (WTI/Maya)                 (5.10)        (4.89)         9.93        (0.43)       4.68        9.77         10.38          4%   -151%    -149%     -109%     -104%     -104%
  Light-Canadian Spread (WTI/WCS)*              19.75         18.21         12.70        17.18       22.03       13.83         17.72          8%     56%      11%      -22%       24%       -3%
  US-Asia Spread (WTI/Dubai)                   (13.15)       (13.19)         1.58        (7.77)      (6.35)      (0.06)         2.07          0%     NM       NM        22%       NM      -476%
Commodity Prices
  WTI                                           92.74         96.86         76.94       103.22       94.46       77.88         78.81         -4%     21%      18%        9%      33%        31%
  Brent                                        111.29        116.60         76.47       117.71      105.21       78.63         79.68         -5%     46%      40%       12%      50%        48%
  Henry Hub Nautral Gas ($/Mcf)                  4.36          4.61          5.04         4.36        4.18        4.33          5.91         -6%    -14%     -26%        4%       1%       -26%
*Rolling 5-Year Average includes October 2006 Through Present; Light-Canadian spread includes Edmonton Lloyd before May 2008

Source: Bloomberg, Morgan Stanley Research


Exhibit 19
Refining Exposure by Company
                                           R&M                Total                                          Refining Exposure
                                         Contrib.           Capacity          PADD 1      PADD 2     PADD 3      PADD 4      PADD 5
Company           Ticker                2011e EPS            (Mbpd)         (Northeast) (Mid-Con) (Gulf Coast) (Rockies) (West Coast) Europe                                  Asia       Other
Refiners
 Alon USA Energy   ALJ                           100%               247                 -                 -                62%                 -            38%          -           -       -
 Delek US Holding   DK                           100%               140                 -                 -               100%                 -              -          -           -       -
 Frontier Oil      FTO                             ++               182                 -               71%                  -               29%              -          -           -       -
 Holly Corp        HOC                             ++               256                 -               49%                39%               12%              -          -           -       -
 Sunoco            SUN                            10%               505              100%                 -                  -                 -              -          -           -       -
 Tesoro            TSO                           100%               665                 -               17%                  -                 -            68%          -           -     14%
 Valero Energy     VLO                           100%             2,640                 -               11%                69%                 -            12%          -           -      9%
 Western Refining WNR                            100%               154                 -                 -               100%                 -              -          -           -       -

Integrated Oil Companies
  Chevron Corp      CVX                            8%             2,160                 4%                -                15%                2%            24%       10%       35%         8%
  ConocoPhillips    COP                           12%             2,437                17%              15%                33%                2%            15%       14%        3%          -
  ExxonMobil        XOM                            9%             6,423                16%               5%                24%                 -             2%       27%       29%        13%
  Hess Corp         HES                            7%               245                29%                -                  -                 -              -         -         -        71%
  Marathon Oil      MRO                           35%             1,142                  -              53%                47%                 -              -         -         -          -
  Murphy Oil        MUR                           10%               295                  -              12%                42%                 -              -       46%         -          -
Source: Company data, Morgan Stanley Research estimates, VLO/CVX not pro-forma for pending Pembroke sale




                                                                                                                                                                                            11
                                                                                                                                                                                            MORGAN                            STANLEY                                    RESEARCH

                                                                                                                                                                                            June 27, 2011
                                                                                                                                                                                            Refining & Marketing




Refining Sector: Investment Thesis
Industry View: Attractive: We believe the US refining                                                                                                                                       Exhibit 21

equities have attractive upside vs. the market on a 12-month                                                                                                                                YTD R&M Stock Performance
basis. Our positive view is less a macro call on global cracks
spreads and product demand and more a series of stock calls                                                                                                                                                                                                                                                                                          DK, 92.4%
within the group and crude feedstock issue (supply). We
believe SUN restructuring with upside event driven catalysts.                                                                                                                                                                                                                                                                          ALJ, 70.9%
We prefer all refiners with exposure to Mid-con pricing
differentials. We expect the US unconventional oil boom                                                                                                                                                                                                                                                                  FTO, 59.2%
(centered in Mid-Con) and Canadian growth will create storage
issues at Cushing, OK until new pipeline capacity is                                                                                                                                                                                                                                                        WNR, 53.5%
constructed mid-2013. Refiners exposed to WTI, WTI-linked
crude or Canadian heavy-light differentials will benefit
                                                                                                                                                                                                                                                                                                HOC, 46.7%
significantly. We expect differentials to average $8/bbl in 2011
and widen in 2012 where we believe in excess of 350kbpd will
                                                                                                                                                                                                                                                         TSO, 12.4%
exceed pipeline, truck, rail and barge potential.
                                                                                                                                                                                                                                            Refining,
Exhibit 20                                                                                                                                                                                                                                   7.8%
Energy Sector and Market YTD Performance
  9%
                                                                                                                                                                                                                                           Energy, 4.0%
                        7.8%
  8%
                                                                                                                                                                                                                                    S&P 500,
  7%                                                                                                                                                                                                                                 0.9%
  6%
                                                             5.2%
                                                                                                                                                                                                                                  VLO, 0.3%
  5%

  4%
                                                                                            3.0%                                                                                               SUN, -2.9%
  3%

  2%                                                                                                                            1.5%
                                                                                                                                                                 0.9%                           -20%                          0%                         20%                       40%                      60%                         80%                      100%
  1%

  0%                                                                                                                                                                                        Source: FactSet, Morgan Stanley Research
                       Refining                     Integrated                              E&P                        Oil Services                             S&P 500

Source: FactSet, Morgan Stanley Research


Exhibit 22                                                                                                                                                                                  Exhibit 23
Refining Coverage: EV / NTM Consensus EBITDA                                                                                                                                                Refining Coverage: EV / Complexity Barrel
  10.0x                                                                                                                                                                                      $1,500

   9.0x
                                                                                                                                                                                             $1,250
   8.0x

   7.0x
                                                                                                                                                                                             $1,000
   6.0x

   5.0x                                                                                                                                                                                       $750

   4.0x
                                                                                                                                                                                              $500
   3.0x

   2.0x                                                                                                                                                                                       $250

   1.0x
                                                                                                                                                                                                $0
   0.0x
                                                                                                                                                                                                      1/30/1998

                                                                                                                                                                                                                  1/29/1999

                                                                                                                                                                                                                               1/31/2000

                                                                                                                                                                                                                                             1/31/2001

                                                                                                                                                                                                                                                           1/31/2002

                                                                                                                                                                                                                                                                       1/31/2003

                                                                                                                                                                                                                                                                                    1/30/2004

                                                                                                                                                                                                                                                                                                1/31/2005

                                                                                                                                                                                                                                                                                                             1/31/2006

                                                                                                                                                                                                                                                                                                                           1/31/2007

                                                                                                                                                                                                                                                                                                                                         1/31/2008

                                                                                                                                                                                                                                                                                                                                                     1/30/2009

                                                                                                                                                                                                                                                                                                                                                                 1/29/2010

                                                                                                                                                                                                                                                                                                                                                                             1/30/2011
          06/25/2004


                          01/21/2005


                                       08/19/2005


                                                     03/17/2006


                                                                  10/13/2006


                                                                               05/11/2007


                                                                                             12/07/2007


                                                                                                          07/03/2008


                                                                                                                         01/30/2009


                                                                                                                                      08/28/2009


                                                                                                                                                   03/26/2010


                                                                                                                                                                  10/22/2010


                                                                                                                                                                               05/20/2011




                                                                                                                                                                                            Source: FactSet, Company data, Morgan Stanley Research
Source: FactSet, Morgan Stanley Research




                                                                                                                                                                                                                                                                                                                                                                             12
                                                                                                    MORGAN                               STANLEY                                         RESEARCH

                                                                                                    June 27, 2011
                                                                                                    Refining & Marketing




Investment Themes in Refining
1. Mid-Con Refining: Structural widening of          WTI-Brent spread to remain wide through 2012
WTI vs. waterborne crudes lead to margin             Refiners with access to WTI/WTI-linked crude oil will benefit
upside for refiners with access to advantaged          $22                                                        Brent-WTI                                Average                         MS 2011 Forecast

crude oils.                                            $20
                                                       $18
                                                       $16
Thesis: Growing crude production from Canada           $14
and Lower 48 unconventional resource will              $12

pressure storage constraints at Cushing,               $10
                                                        $8
Oklahoma, causing WTI to trade at a discount to         $6
Brent and waterborne crude oils. Approximately          $4
                                                        $2
20% of US refining capacity can process
                                                        $0
advantaged crude oils, capturing the differential       ($2)

and directly increasing gross margins.                  ($4)
                                                        ($6)
                                                               Jul-06

                                                                         Oct-06

                                                                                  Jan-07

                                                                                           Apr-07

                                                                                                     Jul-07

                                                                                                              Oct-07

                                                                                                                       Jan-08

                                                                                                                                Apr-08

                                                                                                                                         Jul-08

                                                                                                                                                  Oct-08

                                                                                                                                                             Jan-09

                                                                                                                                                                      Apr-09

                                                                                                                                                                                Jul-09

                                                                                                                                                                                         Oct-09

                                                                                                                                                                                                   Jan-10

                                                                                                                                                                                                            Apr-10

                                                                                                                                                                                                                     Jul-10

                                                                                                                                                                                                                              Oct-10

                                                                                                                                                                                                                                       Jan-11

                                                                                                                                                                                                                                                Apr-11
Investment Ideas: WNR, MRO
                                                     Source: Bloomberg, Morgan Stanley Research estimates


2. Restructuring narrows discounts to SOTP           Positive market reception to restructuring stories
                                                     Deleveraging and high-grading portfolios increases valuation
Thesis: Companies can reduce persistent
                                                                                                                                                                                                                      Date                        Relative
discount to NAV’s by selling or spinning off         Company          Actions Taken                                                                                                                                  Started                    Performance*
assets. Heightened interest mainly from National                      Intent to sell $10B in assets. Reduced Lukoil
                                                     ConocoPhillips   stake, sold Syncrude interest, sold CFJ Properties                                                                                               Oct-09                            19%
Oil Companies for upstream assets, institutional                      (marketing assets)
investor for midstream assets, and private equity                     Closures and sales of refineries and announced
                                                     Sunoco           divestiture of noncore assets (chemicals, logistics,                                                                                             Jun-09                            6%
for downstream assets have allowed companies
                                                                      and Suncoke)
to offload noncore assets. The resulting                              New CEO institutes corporate strategy and plans
                                                     Tesoro                                                                                                                                                           May-10                             29%
high-graded portfolios will receive higher                            IPO for midstream MLP
                                                                      Plans to exit Refining business and sell UK
valuations and companies can return cash to          Murphy Oil
                                                                      marketing assets
                                                                                                                                                                                                                        Jul-10                           -9%

shareholders or pay down debt.                       Western Refining
                                                                      Shutdown of Yorktown refinery and evaluation of
                                                                                                                                                                                                                      Aug-10                             179%
                                                                      strategic alternatives
                                                     Marathon Oil     Spin off of downstream assets                                                                                                                    Jan-11                            29%
Investment Ideas: SUN, WNR, MRO
                                                     Average Performance                                                                                                                                                                                 42%
                                                     *indicates performance versus subsector since date started
                                                     Source: Company data, Morgan Stanley Research


3. Distillation Utilization Steadily Increasing      Tightening Distillate Market Through 2013
Through 2015 With Supply Risks Balanced.             Global demand growth for diesel, gasoil, and naphtha products
                                                       93%
Thesis: Secular demand remains for middle
distillates as emerging market transportation          92%

growth and industrialization will favor diesel,        91%

gasoil, and naphtha fuels over gasoline. The           90%
demand trend favors high complexity refiners, as
                                                       89%
middle distillate is the most difficult product to
produce from a barrel of crude oil.                    88%


                                                       87%
Investment Ideas: VLO
                                                       86%


                                                       85%
                                                                        2004               2005               2006                 2007                    2008                2009               2010E              2011E             2012E

                                                     Source: IEA, Morgan Stanley Research estimates




                                                                                                                                                                                                                                                                13
                                                                                         MORGAN          STANLEY           RESEARCH

                                                                                         June 27, 2011
                                                                                         Refining & Marketing




Independent Refiners: Investment Thesis, Catalysts and Risks
       Investment Thesis                                                                   Potential Catalysts                      Risks
 ALJ   Big Spring refinery runs advantaged WTS crude oil, while low complexity             California upside in 2012 from           Alon suggested it is still open to
(UW)   Krotz Spring runs expensive LLS crude. Highest debt leverage in our                 Bakersfield online and higher realized   M&A, with a possible dilutive or
       coverage; weak earnings outlook challenges prospect of debt reduction.              margins from hydrocracker at             debt-heavy acquisition. Few
       California refinery (Paramount) currently runs at below 40% utilization and         Paramount. Demand increases for          refining assets makes ALJ
       provides limited future earnings. Retail’s contribution to earnings is positive     asphalt from major contract markets      exposed to unexpected outage,
       to help offset less profitable refining.                                            in CA and TX. Spinout of retail          with a poor operating history.
                                                                                           business could unlock value with
                                                                                           proceeds used to reduce leverage.
 DK    Operates in refinery in Tyler, Texas, and recently acquired El Dorado,              Widening of the sweet-sour spread.       Delek suggested it is still open to
(EW)   Arkansas refinery with exposure to advantaged Mid-Con crudes and                    Potential spinout of the retail          M&A, with a possible dilutive or
       sweet-sour differential. El Dorado refinery acquisition reduces risks               business could unlock value, using       debt-heavy acquisition. Continued
       associated with a single refining asset. Largest relative retail exposure of        proceeds to fuel refining growth.        poor margins in the Gulf Coast and
       the independent refiners provides greater earnings stability over time, but                                                  narrow sweet-sour spreads.
       lower upside leverage to refining margins.                                                                                   Parent buys in the public float.

SUN    SUN typically perceived as disadvantaged Northeast refiner yet its 2012E            Filing the SunCoke S-1 and eventual      Management’s timing in unlocking
(OW)   EPS exposure is less than 10%. Majority of earnings are levered to growth           spin-off. Vansant resource reserve       value of non-refining assets is
       businesses including Coke, logistics and retail. Management has moved to            report and/or monetization of            delayed. Worse performance in
       “unlock” value by monetizing SunCoke and continues to explore other                 Vansant metallurgical coal mine.         Northeast refining from higher
       alternatives for asset sales and spin offs.                                         Growth in the MLP business with          gasoline imports and poor margins
                                                                                           further drop downs and monetization      due to waterborne crude inputs
                                                                                           of undervalued GP units in SXL.          and lower complexity.
                                                                                           Special dividend post SunCoke spin.

TSO    Primarily a West Coast refiner with five assets on the West Coast in Hawaii.        Hawaii PUC restructures fuel oil         West Coast recovery remains
(EW)   Moderate exposure to Mid-Con differentials (17%) at two Mid-Con assets in           contracts. Economic improvement in       evasive with low utilization rates.
       Salt Lake and Mandan that run advantaged local crudes (Black Wax and                California will drive refined product    Anacortes incident is prolonged
       Bakken). Asset restructuring will monetize non-core assets and avail higher         demand data. Filing revised TLLP         and causes further investigations
       MLP multiple in TLLP IPO in early 2Q11. California and Mid-con regions are          S-1, subsequent IPO and potential        in remaining assets in portfolio.
       more structurally protected from imports.                                           2011 drop-downs in to TLLP.              Punitive environmental regulations
                                                                                                                                    in California

VLO    Year-on-year portfolio high grades (Del City and Paulsboro sales) and               Asset sales with completion of the       Most susceptible to weakening
(EW)   reduced cost structure drive significant, commodity-agnostic levered                Aruba positive as total value likely     global refining margins. Increased
       earnings improvements in 2011-2012. Moderate exposure to Mid-Con                    ~$600MM. Acquisition funded by           PADD 2 refining throughputs back
       differentials (12%) but could benefit from heavy and sour crude oils at Gulf        cash at low complexity barrel price to   out PADD 3 inputs and reduce
       Coast refineries that export ~40% of refined product to South America.              be accretive and alleviate fears of      Gulf Coast refining margins.
       Strong balance sheet with over $3 Bn of cash to fund future capex.                  overpaying. Positive earnings            Narrowing heavy-light and
       Diversity, size and scale of portfolio as the largest US Independent refiner        revisions as portfolio improvements      sweet-sour spreads.
       provide leverage to a US recovery.                                                  reflected in 2011E.

WNR    Deleveraging story with up to $560MM of potential asset sales in 2011 to            Announcement of a formal M&A             Pipeline reversals occur more
(OW)   support a capital restructuring, debt reduction and removal of covenant             process and ultimate sale of             quickly than expected, eliminating
       heavy, debt obligations. Emerging as a niche refiner in the Southwest with          midstream assets: (1) Yorktown           WTI-linked vs. waterborne crude
       ability to run 100% WTI/WTI-linked crude slate. El Paso is a simple refiner         terminal and storage, and (2)            differentials and Mid-Con benefits.
       with sweet crude intake from West Texas (Permian basin) supporting                  Southwest terminal, storage, asphalt     Management does not execute
       margin-rich markets in Arizona, New Mexico and Juarez, Mexico. Yorktown             terminal and pipelines. Higher           restructuring of the company.
       refinery closure removes operating loss and allows for monetization of              realized margin benefit from             WNR issues equity that dilutes
       inventory and potential MLP of storage and terminal assets                          WTI-linked crudes vs. waterborne         existing shareholders. Debt
                                                                                           crudes.                                  covenant issues from high
                                                                                                                                    leverage and high fixed charges.




                                                                                                                                                                         14
                                                                                 MORGAN               STANLEY         RESEARCH

                                                                                 June 27, 2011
                                                                                 Refining & Marketing




Morgan Stanley Commodity Forecasts
Exhibit 24                                                                       Exhibit 25
Morgan Stanley Base Commodity Forecasts                                          2011 Crack Spread Forecast
  WTI Crude            Q1          Q2           Q3         Q4        Annual                                         Q1A         Q2E        Q3E        Q4E       Annual
    2008             $97.82      $123.80      $118.22    $59.08      $99.73      Blended Cracks
    2009             $43.31      $59.79       $68.24     $76.13      $61.87      Gulf Coast 5-3-2 (LLS)         $5.37         $8.35      $5.17       $4.14       $5.76
    2010             $78.88      $78.00       $76.21     $85.24      $79.58      Gulf Coast 3-2-1 (LLS)         $4.70         $8.18      $5.00       $4.00       $5.47
   2011E             $94.26      $101.01      $108.23    $107.35     $102.71     Gulf Coast 2-1-1 (LLS)         $6.37         $8.60      $5.43       $4.35       $6.19
                                                                                 Gulf Coast 5-3-2 (WTI)        $18.56        $24.02     $13.17      $12.14      $16.97
   2012E             $104.69     $104.69      $104.69    $104.69     $104.69
                                                                                 Gulf Coast 3-2-1 (WTI)        $17.90        $23.85     $13.00      $12.00      $16.69
  Long-term          $88.00       $88.00       $88.00    $88.00       $88.00     Gulf Coast 2-1-1 (WTI)        $19.57        $24.27     $13.43      $12.35      $17.40
                                                                                 NY 2-1-1 (Brent)               $9.06        $12.81      $7.12       $5.69       $8.67
 Brent Crude           Q1          Q2           Q3         Q4        Annual
                                                                                 Northeast 6-3-2-1 (Brent)      $7.78        $11.10      $5.55       $4.44       $7.22
     2008            $96.48      $122.20      $115.91    $56.23      $97.71                                    $17.50        $18.06     $16.91      $13.53      $16.50
                                                                                 West Coast 3-2-1 (ANS)
     2009            $45.04      $59.28       $68.25     $74.93      $61.88      USWC ANS 4-3-1 (ANS)          $17.06        $17.63     $16.89      $13.51      $16.27
     2010            $76.78      $79.00       $76.41     $86.93      $79.78      Pacific NW 5-3-1-1 (ANS)      $15.36        $18.15     $15.11      $12.09      $15.18
    2011E            $104.91     $116.70      $116.23    $115.35     $113.30     Midcon 3-2-1 (WTI)            $19.08        $26.54     $15.15      $13.98      $18.69
    2012E            $112.69     $112.69      $112.69    $112.69     $112.69     Midcon 2-1-1 (WTI)            $20.59        $26.75     $16.10      $14.86      $19.58
                                                                                 Midcon 6-3-2-1 (WTI)          $15.28        $21.07      $9.42       $8.70      $13.62
  Long-term          $90.00       $90.00       $90.00    $90.00       $90.00
                                                                                 Differentials
 Natural Gas           Q1           Q2           Q3           Q4      Annual     LLS less Maya                  $18.02        $16.19     $16.50     $16.50      $16.80
    2008              $8.74       $11.47        $8.99        $6.40     $8.90     LLS less Mars                   $5.71         $7.07      $5.00      $5.00       $5.70
                                                                                 LLS less WTI                   $13.19        $15.69      $8.00      $8.00      $11.22
    2009              $4.47        $3.81        $3.44        $4.93     $4.16
                                                                                 WTI less WTS                    $4.23         $2.88      $3.00      $3.00       $3.28
    2010              $5.30        $4.40        $4.38        $3.80     $4.47
                                                                                 WTI less Lloyd WCS             $22.17        $16.93     $15.00     $15.00      $17.27
   2011E              $4.20        $4.45        $4.62        $4.86     $4.53
                                                                                 KERN River less ANS           ($11.43)      ($10.00)   ($10.00)   ($10.00)    ($10.36)
   2012E              $5.14        $4.94        $5.03        $5.12     $5.06
                                                                                 WTI less ANS                   ($7.04)      ($11.48)     $3.00      $3.00      ($3.13)
  Long-term           $5.50       $5.50         $5.50        $5.50     $5.50     DURI less ANS                   $2.41        ($4.00)    ($4.00)    ($4.00)     ($2.40)
Source: Bloomberg, Morgan Stanley Research estimates                             Tapis less ANS                  $8.29         $5.00      $5.00      $5.00       $5.82
                                                                                 ANS less Mars                  ($0.44)        $3.01      $1.00      $1.00       $1.14
                                                                                 ANS less Maya                  $11.87        $12.06      $8.00      $8.00       $9.98
                                                                                 Source: Morgan Stanley Research estimates




Exhibit 26                                                                       Exhibit 27
Crude Oil Forecast vs. Forward Curve (Brent)                                     Natural Gas Forecast vs. Forward Curve (Henry Hub)
                     Forward Cruve             MS Forecast           Consensus    $7                  Forward Cruve              MS Forecast              Consensus
 $130
 $120                                                                             $6
 $110
                                                                                  $5
 $100
  $90                                                                             $4
  $80
                                                                                  $3
  $70
                                                                                              2010A         2011E            2012E          2013E             2014E
             2010A            2011E        2012E        2013E         2014E
                                                                                 Source: Bloomberg, Morgan Stanley Research estimates
Source: Bloomberg, Morgan Stanley Research estimates




                                                                                                                                                                      15
                                                                                                                                            MORGAN                         STANLEY                              RESEARCH

                                                                                                                                            June 27, 2011
                                                                                                                                            Refining & Marketing




Global Economic & Leading Indicators
Exhibit 28
Morgan Stanley GDP Estimates (YoY Change)
       5.0%                                                                                             US GDP (yoy % change)             4.0%                                                                                    EMU GDP (yoy % change)
                                                                                                                                                                                         3.1%
                3.9%                                                                                                                                                                                     2.8%
       4.0%                                                                                                                               3.0%
                           3.1%                                                                                                 3.2%                    1.9%         1.8%                                                                               2.0%
                                        2.8%                                                             2.9%                             2.0%                                                                                               1.7%
       3.0%                                                                                                          2.7%
                                                                                                                                                                                                                                                                  1.2%
                                                            2.0%                                                                          1.0%
       2.0%                                                                                                                                                                                                          0.4%
                                                                                                                                          0.0%
       1.0%
                                                                            0.0%                                                          -1.0%
       0.0%
                                                                                                                                          -2.0%
    -1.0%
                                                                                                                                          -3.0%
    -2.0%                                                                                                                                 -4.0%
                                                                                                                                                                                                                                -4.0%
    -3.0%                                                                                   -2.6%                                         -5.0%
                2004        2005        2006                2007            2008             2009        2010        2011E      2012E                    2004            2005            2006            2007        2008       2009         2010       2011E     2012E

   14.0%                                                                                        China GDP (yoy % change)                 12.0%                                                                                             India GDP (yoy % change)
                                                            13.0%
                                      11.6%                                                                                                                                              9.9%
   12.0%                                                                                                                                 10.0%                                                           9.3%
                                                                                                                                                                   9.1%
                10.1%    10.4%                                                                            10.3%                                                                                                                               8.8%                  8.7%
   10.0%                                                                    9.6%
                                                                                             9.1%                     9.0%       9.0%                                                                                7.5%                                7.7%
                                                                                                                                         8.0%                                                                                   7.2%
                                                                                                                                                      7.0%
    8.0%
                                                                                                                                         6.0%
    6.0%
                                                                                                                                         4.0%
    4.0%

    2.0%                                                                                                                                 2.0%


    0.0%                                                                                                                                 0.0%
                2004       2005             2006            2007            2008             2009         2010        2011E      2012E                2004         2005                  2006            2007        2008       2009          2010      2011E     2012E


Source: Morgan Stanley Research




Exhibit 29                                                                                                                                  Exhibit 30
ECRI Weekly Leading Index (1992=100)                                                                                                        US Industrial Production Index (2007=100)
 150                                                                                                                                         105



                                                                                                                                             100
 140


                                                                                                                                                 95
 130

                                                                                                                                                 90

 120

                                                                                                                                                 85

 110
                                                                                                                                                 80


 100
                                                                                                                                                 75
       Jul-01



                Jul-02



                         Jul-03



                                   Jul-04



                                                   Jul-05



                                                                   Jul-06



                                                                                   Jul-07



                                                                                               Jul-08



                                                                                                            Jul-09



                                                                                                                       Jul-10




                                                                                                                                                      Jul-01



                                                                                                                                                                Jul-02



                                                                                                                                                                                Jul-03



                                                                                                                                                                                                Jul-04



                                                                                                                                                                                                            Jul-05



                                                                                                                                                                                                                       Jul-06



                                                                                                                                                                                                                                  Jul-07



                                                                                                                                                                                                                                               Jul-08



                                                                                                                                                                                                                                                         Jul-09



                                                                                                                                                                                                                                                                  Jul-10




Source: Bloomberg, Morgan Stanley Research
                                                                                                                                            Source: Bloomberg, Morgan Stanley Research




                                                                                                                                                                                                                                                                           16
                                                                             MORGAN                                  STANLEY                                        RESEARCH

                                                                             June 27, 2011
                                                                             Refining & Marketing




 Crude Oil Markets
Exhibit 31                                                                   Exhibit 32
Global Crude Oil Prices                                                      5-Year Brent Crude Oil Prices ($/bbl)
                                     This Week        Last Week Last Year       $160

(US$/bbl)                             24-Jun-11        17-Jun-11 24-Jun-10                                                                                                                                           12-Month Strip                                Front Month
                                                                                $140
Global Benchmarks
  WTI Cushing                            $90.83          $93.01     $76.16      $120

  Dated Brent                           $106.16         $113.49     $75.17
                                                                                $100
  Tapis                                 $116.09         $121.21     $79.83
  Bonny Light                           $108.09         $115.89     $76.72       $80

  Dubai Fateh                           $103.82         $106.71     $73.55       $60
Futures
  NYMEX front month                      $91.23          $93.01     $76.51       $40

  ICE Brent front month                 $105.71         $113.21     $76.47       $20
North Am Spot Crudes
                                                                                  $0
  LLS St James                          $105.83         $112.51     $79.31




                                                                                                 Oct-06




                                                                                                                                       Oct-07




                                                                                                                                                                             Oct-08




                                                                                                                                                                                                                    Oct-09




                                                                                                                                                                                                                                                          Oct-10
                                                                                       Jul-06



                                                                                                            Jan-07

                                                                                                                     Apr-07

                                                                                                                              Jul-07



                                                                                                                                                Jan-08

                                                                                                                                                          Apr-08

                                                                                                                                                                    Jul-08



                                                                                                                                                                                      Jan-09

                                                                                                                                                                                               Apr-09

                                                                                                                                                                                                          Jul-09



                                                                                                                                                                                                                             Jan-10

                                                                                                                                                                                                                                      Apr-10

                                                                                                                                                                                                                                               Jul-10



                                                                                                                                                                                                                                                                     Jan-11

                                                                                                                                                                                                                                                                              Apr-11
  Syncrude Sweet                         $97.83         $102.01     $74.21
  Alaska North Slope                    $103.83         $108.21     $76.41
  WTS Midland                            $89.73          $91.31     $73.56   Source: Bloomberg, Morgan Stanley Research
  Mars Blend                            $102.83         $106.76     $75.06
  Venezuela                             $101.07         $104.29     $67.69   Exhibit 33
  Maya                                   $95.20          $98.68     $65.86   North American Crude Differentials to WTI ($/bbl)
  Western Canadian Select                $69.33          $74.51     $63.46
                                                                              $25.00               +1 Standard Deviation                             -1 Standard Deviation                              Current Differential                   Trailing 2 Yr Avg
European Spot Crudes
  Oseberg                               $108.21         $115.69     $77.09    $20.00
  Brent                                 $106.46         $114.09     $76.07
                                                                              $15.00
  Flotta                                $103.93         $111.48     $73.62
Middle East Spot Crudes                                                       $10.00
  Murbian                               $108.39         $111.58     $74.43
  Oman                                  $104.34         $107.08     $73.76     $5.00
  Arab Light                             $92.16          $93.85     $76.80
                                                                               $0.00
  Arab Medium                            $89.46          $91.15     $75.00
  Arab Heavy                             $86.91          $88.60     $73.45     ($5.00)
African Spot Crudes
  Algeria Saharan                       $107.83         $115.37     $75.31    ($10.00)
                                                                                                Light LA Sweet Syncrude Sweet Alaska N Slope                                                                       WTS Midland                          Mars Blend
  Nigeria Brass River                   $105.96         $113.67     $75.24
  Angola Cabinda                        $105.27         $112.94     $74.93   Source: Bloomberg, Morgan Stanley Research
  Suez Blend                            $100.81         $108.51     $71.51
Asian Spot Crudes                                                            Exhibit 34
  Papua New Guinea                      $114.59         $119.71     $78.33   Global Crude Differentials to Brent ($/bbl)
  Australia Gippsland                   $112.59         $117.71     $76.93
                                                                              $15.00                      +1 Standard Deviation                          -1 Standard Deviation                            Current Differential                          Trailing 2 Yr Avg
  Indonesia Minas                       $112.86         $119.43     $80.03
Global Refining Margins                                                       $10.00

  USGC (WTI)                                 $19.47      $25.56      $8.09     $5.00
  NWE (Brent)                                 $7.72       $6.84      $9.79
                                                                               $0.00
  Singapore (Tapis)                           $2.19       $0.81      $5.54
  AG (Dubai)                                 $14.46      $15.31     $11.82     ($5.00)

NYMEX Refining Margins                                                        ($10.00)
  NYMEX Front 321                            $19.47      $25.56      $8.09
                                                                              ($15.00)
  NYMEX 321 Strip                            $20.87      $26.29      $9.10
  NYMEX CL HO                                $25.79      $32.29     $10.78    ($20.00)

  NYMEX HO CL 12 strip                       $26.06      $32.75     $12.43    ($25.00)
  NYMEX CL XB                                $23.43      $30.72     $11.20
                                                                              ($30.00)
  NYMEX XB CL 12 strip                       $18.28      $23.06      $7.44                                Tapis               Bonny Light                          Arab Light                   Murbian                      Dubai Fatah                       Arab Heavy
Source: Bloomberg, Morgan Stanley Research
                                                                             Source: Company data, Morgan Stanley Research




                                                                                                                                                                                                                                                                                       17
                                                                                                                                                                                                                                       MORGAN                                                  STANLEY                                                                   RESEARCH

                                                                                                                                                                                                                                       June 27, 2011
                                                                                                                                                                                                                                       Refining & Marketing




Commitment of Traders Report
Exhibit 35                                                                                                                                                                                                                             Exhibit 37
Crude Oil - CFTC Net Speculative Position                                                                                                                                                                                              Distillate - CFTC Net Speculative Position
 $160                                                            Net Crude Oil Long (Short)                                                      Front Month Crude (WTI)                                                   350,000      $5.00                                                           Net Distillate Long (Short)                                                                                                 Front Month Distillate                                                                  80,000

                                                                                                                                                                                                                                        $4.50                                                                                                                                                                                                                                                                               70,000
 $140                                                                                                                                                                                                                      300,000
                                                                                                                                                                                                                                        $4.00                                                                                                                                                                                                                                                                               60,000
                                                                                                                                                                                                                           250,000
 $120                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       50,000
                                                                                                                                                                                                                                        $3.50
                                                                                                                                                                                                                           200,000
 $100                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       40,000
                                                                                                                                                                                                                                        $3.00
                                                                                                                                                                                                                           150,000                                                                                                                                                                                                                                                                                          30,000
  $80                                                                                                                                                                                                                                   $2.50
                                                                                                                                                                                                                           100,000                                                                                                                                                                                                                                                                                          20,000
                                                                                                                                                                                                                                        $2.00
  $60                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       10,000
                                                                                                                                                                                                                           50,000
                                                                                                                                                                                                                                        $1.50
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            0
  $40
                                                                                                                                                                                                                           0            $1.00                                                                                                                                                                                                                                                                               (10,000)
  $20                                                                                                                                                                                                                      (50,000)     $0.50                                                                                                                                                                                                                                                                               (20,000)

   $0                                                                                                                                                                                                                      (100,000)    $0.00                                                                                                                                                                                                                                                                               (30,000)




                                                                                                                                                                                                                                                Jul-06

                                                                                                                                                                                                                                                            Oct-06

                                                                                                                                                                                                                                                                         Jan-07

                                                                                                                                                                                                                                                                                      Apr-07

                                                                                                                                                                                                                                                                                                   Jul-07

                                                                                                                                                                                                                                                                                                                 Oct-07

                                                                                                                                                                                                                                                                                                                               Jan-08

                                                                                                                                                                                                                                                                                                                                             Apr-08

                                                                                                                                                                                                                                                                                                                                                           Jul-08

                                                                                                                                                                                                                                                                                                                                                                             Oct-08

                                                                                                                                                                                                                                                                                                                                                                                               Jan-09

                                                                                                                                                                                                                                                                                                                                                                                                             Apr-09

                                                                                                                                                                                                                                                                                                                                                                                                                           Jul-09

                                                                                                                                                                                                                                                                                                                                                                                                                                        Oct-09

                                                                                                                                                                                                                                                                                                                                                                                                                                                     Jan-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                                  Apr-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Jul-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          Oct-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      Jan-11

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 Apr-11
           Jul-06
                       Oct-06




                                                                      Oct-07




                                                                                                             Oct-08




                                                                                                                                                   Oct-09




                                                                                                                                                                                          Oct-10
                                   Jan-07
                                               Apr-07
                                                          Jul-07


                                                                                Jan-08
                                                                                          Apr-08
                                                                                                    Jul-08


                                                                                                                      Jan-09
                                                                                                                               Apr-09
                                                                                                                                        Jul-09


                                                                                                                                                            Jan-10
                                                                                                                                                                      Apr-10
                                                                                                                                                                                Jul-10


                                                                                                                                                                                                     Jan-11
                                                                                                                                                                                                                Apr-11




Left Axis – NYMEX NG front month futures ($/Mcf), Right Axis - Sum of NG combined futures                                                                                                                                              Left Axis – NYMEX HO front month futures ($/bbl), Right Axis – HO net speculative position
and options with normal and penultimate HH swaps adjusted by futures lot size. Options                                                                                                                                                 Source: Company data, Morgan Stanley Research
include European Style Options for NG, with data only available since April 2008
Source: Company data, Morgan Stanley Research
                                                                                                                                                                                                                                       Exhibit 38

Exhibit 36                                                                                                                                                                                                                             RBOB - CFTC Net Speculative Position
Natural Gas - CFTC Net Speculative Position                                                                                                                                                                                              $4.00                                                                            Net RBOB Long (Short)                                                                                     Front Month RBOB                                                                        100,000

 $16                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        90,000
                                                                   Nat Gas Net Long (Short)                                                      Front Month Nat Gas                                                                     $3.50
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            80,000
                                                                                                                                                                                                                           250,000       $3.00
 $14
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            70,000
                                                                                                                                                                                                                                         $2.50
 $12
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            60,000
                                                                                                                                                                                                                           150,000
                                                                                                                                                                                                                                         $2.00                                                                                                                                                                                                                                                                              50,000
 $10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        40,000
                                                                                                                                                                                                                                         $1.50

                                                                                                                                                                                                                           50,000                                                                                                                                                                                                                                                                                           30,000
  $8                                                                                                                                                                                                                                     $1.00
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            20,000

  $6                                                                                                                                                                                                                                     $0.50
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            10,000
                                                                                                                                                                                                                           (50,000)
                                                                                                                                                                                                                                         $0.00                                                                                                                                                                                                                                                                              0
                                                                                                                                                                                                                                                                     Oct-06


                                                                                                                                                                                                                                                                                               Apr-07


                                                                                                                                                                                                                                                                                                                          Oct-07


                                                                                                                                                                                                                                                                                                                                                      Apr-08


                                                                                                                                                                                                                                                                                                                                                                                      Oct-08


                                                                                                                                                                                                                                                                                                                                                                                                                  Apr-09


                                                                                                                                                                                                                                                                                                                                                                                                                                            Oct-09




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             Oct-10
                                                                                                                                                                                                                                                         Jul-06


                                                                                                                                                                                                                                                                                  Jan-07


                                                                                                                                                                                                                                                                                                            Jul-07


                                                                                                                                                                                                                                                                                                                                        Jan-08


                                                                                                                                                                                                                                                                                                                                                                    Jul-08


                                                                                                                                                                                                                                                                                                                                                                                                    Jan-09


                                                                                                                                                                                                                                                                                                                                                                                                                               Jul-09


                                                                                                                                                                                                                                                                                                                                                                                                                                                         Jan-10
                                                                                                                                                                                                                                                                                                                                                                                                                                                                     Apr-10




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        Jan-11
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   Apr-11
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 Jul-10
  $4


  $2                                                                                                                                                                                                                       (150,000)
       Jul-06

                    Oct-06




                                                        Jul-07

                                                                    Oct-07




                                                                                                   Jul-08




                                                                                                                                        Jul-09




                                                                                                                                                                                 Jul-10
                                Jan-07

                                            Apr-07




                                                                               Jan-08

                                                                                         Apr-08



                                                                                                             Oct-08

                                                                                                                      Jan-09

                                                                                                                               Apr-09



                                                                                                                                                   Oct-09

                                                                                                                                                             Jan-10

                                                                                                                                                                       Apr-10



                                                                                                                                                                                            Oct-10

                                                                                                                                                                                                       Jan-11

                                                                                                                                                                                                                  Apr-11




                                                                                                                                                                                                                                       Axis – NYMEX RBOB front month futures ($/bbl), Right Axis – RBOB net spec. position
                                                                                                                                                                                                                                       Source: Company data, Morgan Stanley Research
Left Axis – NYMEX CL front month futures ($/bbl), Right Axis - CL net speculative position
Source: Company data, Morgan Stanley Research




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 18
                                                                                                                                                                                                                             MORGAN                                                            STANLEY                                                       RESEARCH

                                                                                                                                                                                                                             June 27, 2011
                                                                                                                                                                                                                             Refining & Marketing




Crude Fundamentals
Exhibit 39                                                                                                                                                                                                                   Exhibit 42
WTI vs. Brent ($/bbl)                                                                                                                                                                                                        WTI & LLS vs. Maya ($/bbl)
  $10                                                                                                                                                                                                                         $30                                                                                                                          WTI vs. Maya                                          LLS vs. Maya


   $5                                                                                                                                                                                                                         $25


   $0                                                                                                                                                                                                                         $20


   ($5)                                                                                                                                                                                                                       $15


 ($10)                                                                                                                                                                                                                        $10


 ($15)                                                                                                                                                                                                                         $5


 ($20)
                                                                                                                                                                                                                               $0

 ($25)
                                                                                                                                                                                                                               ($5)
           Jul-06
                       Oct-06
                                  Jan-07
                                             Apr-07
                                                        Jul-07
                                                                  Oct-07
                                                                                Jan-08
                                                                                          Apr-08
                                                                                                    Jul-08
                                                                                                              Oct-08
                                                                                                                        Jan-09
                                                                                                                                       Apr-09
                                                                                                                                                 Jul-09
                                                                                                                                                          Oct-09
                                                                                                                                                                    Jan-10
                                                                                                                                                                             Apr-10
                                                                                                                                                                                        Jul-10
                                                                                                                                                                                                 Oct-10
                                                                                                                                                                                                          Jan-11
                                                                                                                                                                                                                    Apr-11




                                                                                                                                                                                                                                                                                                                                                                                                                                                                     Oct-10
                                                                                                                                                                                                                                                        Oct-06




                                                                                                                                                                                                                                                                                                                       Oct-07




                                                                                                                                                                                                                                                                                                                                                                       Oct-08




                                                                                                                                                                                                                                                                                                                                                                                                                   Oct-09
                                                                                                                                                                                                                                                                                                                                    Jan-08

                                                                                                                                                                                                                                                                                                                                                Apr-08




                                                                                                                                                                                                                                                                                                                                                                                  Jan-09

                                                                                                                                                                                                                                                                                                                                                                                             Apr-09

                                                                                                                                                                                                                                                                                                                                                                                                        Jul-09




                                                                                                                                                                                                                                                                                                                                                                                                                              Jan-10

                                                                                                                                                                                                                                                                                                                                                                                                                                           Apr-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                       Jul-10




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  Jan-11

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                Apr-11
                                                                                                                                                                                                                                      Jul-06




                                                                                                                                                                                                                                                                          Jan-07

                                                                                                                                                                                                                                                                                            Apr-07

                                                                                                                                                                                                                                                                                                          Jul-07




                                                                                                                                                                                                                                                                                                                                                            Jul-08
Source: Bloomberg, Morgan Stanley Research                                                                                                                                                                                   Source: Bloomberg Morgan Stanley Research


Exhibit 40                                                                                                                                                                                                                   Exhibit 43
LLS vs. Brent ($/bbl)                                                                                                                                                                                                        WTI & LLS vs. Canadian Oil Sands ($/bbl)
 $12                                                                                                                                                                                                                          $50                                                                                      WTI vs. Canada Oil Sands                                                         LLS vs. Canada Oil Sands
                                                                                                                                                                                                                              $45
 $10
                                                                                                                                                                                                                              $40

  $8                                                                                                                                                                                                                          $35

                                                                                                                                                                                                                              $30
  $6
                                                                                                                                                                                                                              $25
  $4                                                                                                                                                                                                                          $20

                                                                                                                                                                                                                              $15
  $2
                                                                                                                                                                                                                              $10
  $0                                                                                                                                                                                                                           $5

                                                                                                                                                                                                                               $0
  ($2)
                                                                                                                                                                                                                                        Jul-06

                                                                                                                                                                                                                                                          Oct-06

                                                                                                                                                                                                                                                                            Jan-07

                                                                                                                                                                                                                                                                                              Apr-07

                                                                                                                                                                                                                                                                                                            Jul-07

                                                                                                                                                                                                                                                                                                                         Oct-07

                                                                                                                                                                                                                                                                                                                                      Jan-08

                                                                                                                                                                                                                                                                                                                                                  Apr-08

                                                                                                                                                                                                                                                                                                                                                              Jul-08

                                                                                                                                                                                                                                                                                                                                                                         Oct-08

                                                                                                                                                                                                                                                                                                                                                                                    Jan-09

                                                                                                                                                                                                                                                                                                                                                                                               Apr-09

                                                                                                                                                                                                                                                                                                                                                                                                          Jul-09

                                                                                                                                                                                                                                                                                                                                                                                                                     Oct-09

                                                                                                                                                                                                                                                                                                                                                                                                                                 Jan-10

                                                                                                                                                                                                                                                                                                                                                                                                                                             Apr-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                          Jul-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Oct-10

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    Jan-11

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  Apr-11
         Jul-06
                     Oct-06
                                Jan-07
                                           Apr-07
                                                      Jul-07
                                                                 Oct-07
                                                                            Jan-08
                                                                                         Apr-08
                                                                                                   Jul-08
                                                                                                             Oct-08
                                                                                                                       Jan-09
                                                                                                                                      Apr-09
                                                                                                                                                Jul-09
                                                                                                                                                          Oct-09
                                                                                                                                                                   Jan-10
                                                                                                                                                                             Apr-10
                                                                                                                                                                                        Jul-10
                                                                                                                                                                                                 Oct-10
                                                                                                                                                                                                          Jan-11
                                                                                                                                                                                                                    Apr-11




                                                                                                                                                                                                                             Prior to May 2008, WTI differential based on Edmonton Lloyd crude blend with Western
Source: Bloomberg, Morgan Stanley Research                                                                                                                                                                                   Canadian Select blend used thereafter
                                                                                                                                                                                                                             Source: Bloomberg, Morgan Stanley Research
Exhibit 41
Total Crude Oil Stocks (ex-SPR, Mbbl)                                                                                                                                                                                        Exhibit 44

  400,000
                                                                                                                                                                                                                             WTI & LLS vs. Mars Sour Crude ($/bbl)
                                                               5 Yr Max                               5 Yr Min                                  5 Yr Avg                         2010                        2011

                                                                                                                                                                                                                               $15                                                                                                                       WTI vs. Mars                                     LLS vs. Mars


                                                                                                                                                                                                                               $10
  350,000
                                                                                                                                                                                                                                 $5


                                                                                                                                                                                                                                 $0


  300,000                                                                                                                                                                                                                       ($5)


                                                                                                                                                                                                                              ($10)


                                                                                                                                                                                                                              ($15)
                                                                                                                                                                                                                                                                                                                                                                                                                                                                   Oct-10
                                                                                                                                                                                                                                                                                                                           Oct-07




                                                                                                                                                                                                                                                                                                                                                                         Oct-08




                                                                                                                                                                                                                                                                                                                                                                                                                   Oct-09
                                                                                                                                                                                                                                                                                                                                                                                                                              Jan-10
                                                                                                                                                                                                                                                                                                                                                                                                                                          Apr-10
                                                                                                                                                                                                                                                                                                                                                                                                                                                      Jul-10


                                                                                                                                                                                                                                                                                                                                                                                                                                                                                Jan-11
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             Apr-11
                                                                                                                                                                                                                                               Jul-06
                                                                                                                                                                                                                                                                 Oct-06
                                                                                                                                                                                                                                                                                   Jan-07
                                                                                                                                                                                                                                                                                                 Apr-07
                                                                                                                                                                                                                                                                                                              Jul-07


                                                                                                                                                                                                                                                                                                                                       Jan-08
                                                                                                                                                                                                                                                                                                                                                   Apr-08
                                                                                                                                                                                                                                                                                                                                                              Jul-08


                                                                                                                                                                                                                                                                                                                                                                                   Jan-09
                                                                                                                                                                                                                                                                                                                                                                                             Apr-09
                                                                                                                                                                                                                                                                                                                                                                                                        Jul-09




  250,000
                                                                                           May




                                                                                                                                                                                                  Nov
                                                                                                                                Jul
                    Jan


                                     Feb

                                                      Mar


                                                                          Apr




                                                                                                             Jun




                                                                                                                                                  Aug


                                                                                                                                                                   Sep


                                                                                                                                                                                  Oct




                                                                                                                                                                                                                   Dec




Source: EIA Morgan Stanley Research                                                                                                                                                                                          Source: Bloomberg, Morgan Stanley Research




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      19
                                                                                       MORGAN               STANLEY           RESEARCH

                                                                                       June 27, 2011
                                                                                       Refining & Marketing




US Product Crack Spreads
Exhibit 45                                                                             Exhibit 48
US Average 3:2:1 Crack Spread                                                          West Coast 3:2:1 (ANS)
  $40                                                                                    $45
                                                                      5 Yr Max                                                                              5 Yr Max

                                                                      5 Yr Min           $40                                                                5 Yr Min
  $35
                                                                                                                                                            5 Yr Avg
                                                                      5 Yr Avg
                                                                                         $35                                                                2010
  $30                                                                 2010
                                                                                                                                                            2011
                                                                      2011
                                                                                         $30
  $25
                                                                                         $25
  $20
                                                                                         $20
  $15
                                                                                         $15
  $10
                                                                                         $10
   $5
                                                                                          $5
   $0                                                                                     $0
                                 May
                     Mar




                                                                     Nov
                           Apr




                                                               Oct
         Jan


               Feb




                                       Jun




                                                   Aug


                                                         Sep
                                             Jul




                                                                              Dec




                                                                                                                        May




                                                                                                                                                      Oct

                                                                                                                                                                Nov
                                                                                                            Mar

                                                                                                                  Apr
                                                                                                Jan


                                                                                                      Feb




                                                                                                                              Jun

                                                                                                                                    Jul




                                                                                                                                                                             Dec
                                                                                                                                          Aug


                                                                                                                                                Sep
Source: Bloomberg, Morgan Stanley Research                                             Source: Bloomberg, Morgan Stanley Research

Exhibit 46                                                                             Exhibit 49
Gulf Coast 3:2:1 (LLS)                                                                 Mid-Continent 3:2:1 (WTI)
  $40                                                                                    $45
                                                                            5 Yr Max
                                                                            5 Yr Min                                                                               5 Yr Max
  $35                                                                                    $40
                                                                            2011                                                                                   5 Yr Min

  $30                                                                       2010         $35                                                                       5 Yr Avg

                                                                            5 Yr Avg                                                                               2010
  $25                                                                                    $30                                                                       2011

  $20                                                                                    $25

  $15                                                                                    $20

  $10                                                                                    $15

   $5                                                                                    $10

   $0                                                                                     $5

  ($5)                                                                                    $0
                                                                                                                        May
                                 May
               Feb




                                                                                                                                                                Nov
                     Mar




                                                                                                Jan


                                                                                                      Feb




                                                                                                                              Jun


                                                                                                                                    Jul


                                                                                                                                          Aug


                                                                                                                                                Sep


                                                                                                                                                      Oct
                           Apr




                                                                     Nov


                                                                               Dec




                                                                                                            Mar


                                                                                                                  Apr
         Jan




                                       Jun


                                             Jul


                                                   Aug


                                                         Sep




                                                                                                                                                                                Dec
                                                               Oct




Source: Bloomberg, Morgan Stanley Research                                             Source: Bloomberg, Morgan Stanley Research

Exhibit 47                                                                             Exhibit 50
Northeast 3:2:1 (Brent)                                                                Midwest 3:2:1 (WTI)
  $35                                                                                    $45
                                                                           5 Yr Max                                                                                      5 Yr Max
                                                                           5 Yr Min      $40                                                                             5 Yr Min
  $30
                                                                           5 Yr Avg                                                                                      2011
                                                                                         $35
                                                                           2010                                                                                          2010
  $25                                                                      2011          $30                                                                             5 Yr Avg


  $20                                                                                    $25

                                                                                         $20
  $15
                                                                                         $15
  $10                                                                                    $10

                                                                                          $5
   $5
                                                                                          $0
   $0
                                                                                         ($5)
                                 May




                                                                     Nov
         Jan


               Feb




                                       Jun


                                             Jul


                                                   Aug


                                                         Sep


                                                               Oct




                                                                               Dec
                     Mar


                           Apr




                                                                                                                        May
                                                                                                            Mar




                                                                                                                                                                   Nov
                                                                                                                  Apr
                                                                                                Jan


                                                                                                      Feb




                                                                                                                              Jun




                                                                                                                                          Aug


                                                                                                                                                Sep


                                                                                                                                                      Oct




                                                                                                                                                                                Dec
                                                                                                                                    Jul




Source: Bloomberg, Morgan Stanley Research                                             Source: Bloomberg, Morgan Stanley Research




                                                                                                                                                                                      20
                                                                                             MORGAN                STANLEY           RESEARCH

                                                                                             June 27, 2011
                                                                                             Refining & Marketing




Gasoline Crack Spreads ($/bbl)
Exhibit 51                                                                                   Exhibit 54
US Average Gasoline Crack                                                                    Mid-Continent Gasoline Crack (WTI)
  $50                                                                           5 Yr Max       $50
                                                                                5 Yr Min                                                                                 5 Yr Max

                                                                                2011                                                                                     5 Yr Min

  $40                                                                           2010           $40                                                                       2011
                                                                                                                                                                         2010
                                                                                5 Yr Avg
                                                                                                                                                                         5 Yr Avg
  $30                                                                                          $30



  $20                                                                                          $20


                                                                                               $10
  $10


                                                                                                $0
   $0


                                                                                              ($10)
  ($10)




                                                                                                                               May
                                                                                                       Jan


                                                                                                             Feb




                                                                                                                                     Jun




                                                                                                                                                 Aug


                                                                                                                                                       Sep


                                                                                                                                                             Oct
                                                                                                                                           Jul




                                                                                                                                                                   Nov
                                                                                                                   Mar


                                                                                                                         Apr




                                                                                                                                                                                Dec
                                      May
                        Mar


                               Apr




                                                  Jul




                                                                    Oct


                                                                          Nov


                                                                                       Dec
          Jan


                 Feb




                                            Jun




                                                        Aug


                                                              Sep




Source: Bloomberg, Morgan Stanley Research                                                   Source: Bloomberg, Morgan Stanley Research


Exhibit 52                                                                                   Exhibit 55
Gulf Coast Gasoline Crack (LLS)                                                              West Coast Gasoline Crack (ANS)
  $40                                                                                          $60
                                                                            5 Yr Max                                                                                5 Yr Max
  $35                                                                       5 Yr Min
                                                                                                                                                                    5 Yr Min
                                                                                               $50
                                                                                                                                                                    2011
  $30                                                                       2011
                                                                                                                                                                    2010
                                                                            2010               $40
  $25                                                                                                                                                               5 Yr Avg
                                                                            5 Yr Avg
  $20                                                                                          $30
  $15
                                                                                               $20
  $10

    $5                                                                                         $10

    $0
                                                                                                $0
   ($5)
                                                                                               ($10)
  ($10)
                                                                                                                               May




                                                                                                                                           Jul




                                                                                                                                                                   Nov
                                                                                                       Jan


                                                                                                             Feb


                                                                                                                   Mar


                                                                                                                         Apr




                                                                                                                                     Jun




                                                                                                                                                 Aug


                                                                                                                                                       Sep


                                                                                                                                                             Oct




                                                                                                                                                                                 Dec
                                      May




                                                  Jul




                                                                          Nov
                  Feb




                                                                    Oct
           Jan




                                            Jun




                                                        Aug


                                                              Sep




                                                                                       Dec
                         Mar


                                Apr




Source: Bloomberg, Morgan Stanley Research                                                   Source: Bloomberg, Morgan Stanley Research

Exhibit 53                                                                                   Exhibit 56
Northeast Gasoline Crack (Brent)                                                             Midwest Gasoline Crack (WTI)
  $35                                                                                          $60
                                                                            5 Yr Max                                                                                      5 Yr Max
                                                                            5 Yr Min                                                                                      5 Yr Min
  $30                                                                                          $50                                                                        2011
                                                                            2011
                                                                            2010                                                                                          2010
  $25                                                                       5 Yr Avg
                                                                                               $40                                                                        5 Yr Avg


  $20                                                                                          $30

  $15                                                                                          $20


  $10                                                                                          $10


   $5                                                                                           $0

                                                                                               ($10)
   $0

                                                                                               ($20)
  ($5)
                                                                                                                               May




                                                                                                                                           Jul




                                                                                                                                                                   Nov
                                                                                                       Jan


                                                                                                             Feb




                                                                                                                                     Jun




                                                                                                                                                 Aug


                                                                                                                                                       Sep


                                                                                                                                                             Oct




                                                                                                                                                                                 Dec
                                                                                                                   Mar


                                                                                                                         Apr
                                      May
          Jan


                 Feb




                                            Jun




                                                        Aug


                                                              Sep


                                                                    Oct
                                                  Jul




                                                                          Nov
                        Mar


                               Apr




                                                                                       Dec




                                                                                             Source: Bloomberg, Morgan Stanley Research
Source: Bloomberg, Morgan Stanley Research




                                                                                                                                                                                       21
                                                                                                               MORGAN              STANLEY                      RESEARCH

                                                                                                               June 27, 2011
                                                                                                               Refining & Marketing




Diesel Crack Spreads ($/bbl)
Exhibit 57                                                                                                     Exhibit 60
US Average ULSD Crack                                                                                          Mid-Continent ULSD Crack (WTI)
  $40                      5 Yr Max           5 Yr Min          2010         2011          5 Yr Avg              $40
                                                                                                                                     5 Yr Max               5 Yr Min          5 Yr Avg           2010           2011

  $35                                                                                                            $35

  $30                                                                                                            $30

  $25                                                                                                            $25

  $20                                                                                                            $20

  $15                                                                                                            $15


  $10
                                                                                                                 $10

                                                                                                                  $5
   $5

                                                                                                                  $0
   $0




                                                                                                                                                      May




                                                                                                                                                                            Jul




                                                                                                                                                                                                                 Nov
                                                                                                                       Jan


                                                                                                                             Feb


                                                                                                                                   Mar


                                                                                                                                             Apr




                                                                                                                                                                  Jun




                                                                                                                                                                                      Aug


                                                                                                                                                                                                Sep


                                                                                                                                                                                                         Oct




                                                                                                                                                                                                                          Dec
                                        May




                                                          Jul




                                                                                     Oct
        Jan


              Feb


                    Mar


                                Apr




                                                  Jun




                                                                   Aug


                                                                           Sep




                                                                                            Nov


                                                                                                         Dec




Source: Bloomberg, Morgan Stanley Research                                                                     Source: Bloomberg, Morgan Stanley Research


Exhibit 58                                                                                                     Exhibit 61

Gulf Coast ULSD Crack (LLS)                                                                                    West Coast ULSD Crack (ANS)
  $35                                                                                                            $45
                                                                                                                                           5 Yr Max              5 Yr Min            5 Yr Avg            2010          2011
                          5 Yr Max            5 Yr Min          5 Yr Avg            2010            2011
                                                                                                                 $40
  $30
                                                                                                                 $35
  $25
                                                                                                                 $30

  $20                                                                                                            $25

                                                                                                                 $20
  $15
                                                                                                                 $15
  $10
                                                                                                                 $10

   $5                                                                                                             $5

   $0                                                                                                             $0
                                                                                                                                                      May




                                                                                                                                                                            Jul




                                                                                                                                                                                                                 Nov
                                                                                                                       Jan


                                                                                                                             Feb


                                                                                                                                   Mar


                                                                                                                                             Apr




                                                                                                                                                                  Jun




                                                                                                                                                                                      Aug


                                                                                                                                                                                                Sep


                                                                                                                                                                                                         Oct




                                                                                                                                                                                                                          Dec
                                        May




                                                          Jul




                                                                                            Nov
        Jan


              Feb


                    Mar


                                Apr




                                                  Jun




                                                                   Aug


                                                                           Sep


                                                                                     Oct




                                                                                                         Dec




Source: Bloomberg, Morgan Stanley Research                                                                     Source: Bloomberg, Morgan Stanley Research


Exhibit 59                                                                                                     Exhibit 62

Northeast ULSD Crack (Brent)                                                                                   Midwest ULSD Crack (WTI)
  $45                                                                                                            $40
                                                                                                                                         5 Yr Max             5 Yr Min            5 Yr Avg            2010        2011
                             5 Yr Max          5 Yr Min         5 Yr Avg         2010             2011

  $40                                                                                                            $35

  $35                                                                                                            $30

  $30                                                                                                            $25

  $25
                                                                                                                 $20
  $20
                                                                                                                 $15
  $15
                                                                                                                 $10
  $10
                                                                                                                  $5
   $5
                                                                                                                  $0
   $0
                                                                                                                                                      May




                                                                                                                                                                                                                 Nov
                                                                                                                       Jan


                                                                                                                             Feb




                                                                                                                                                                  Jun




                                                                                                                                                                                      Aug


                                                                                                                                                                                                Sep


                                                                                                                                                                                                         Oct
                                                                                                                                                                            Jul
                                                                                                                                   Mar


                                                                                                                                             Apr




                                                                                                                                                                                                                          Dec
                                        May




                                                          Jul




                                                                                            Nov
        Jan


              Feb




                                                  Jun




                                                                   Aug


                                                                           Sep


                                                                                     Oct
                    Mar


                                Apr




                                                                                                         Dec




Source: Bloomberg, Morgan Stanley Research                                                                     Source: Bloomberg, Morgan Stanley Research




                                                                                                                                                                                                                                22
                                                                                                                                                                          MORGAN                         STANLEY                                RESEARCH

                                                                                                                                                                          June 27, 2011
                                                                                                                                                                          Refining & Marketing




Other US Product Crack Spreads
Exhibit 63                                                                                                                                                                Exhibit 66
NY Harbor #2 Heating Oil (Brent)                                                                                                                                          NY Harbor 54-Grade Jet Fuel Crack (Brent)
  $35                                                                                                                                                                       $60
                                    5 Yr Max                    5 Yr Min                       5 Yr Avg                2010                        2011                                                        5 Yr Max                       5 Yr Min                  5 Yr Avg                  2010                 2011

  $30                                                                                                                                                                       $50

  $25
                                                                                                                                                                            $40
  $20
                                                                                                                                                                            $30
  $15
                                                                                                                                                                            $20
  $10

   $5                                                                                                                                                                       $10


   $0                                                                                                                                                                        $0
                                                                      May




                                                                                                                                                                                                                                        May
                                                                                           Jul




                                                                                                                                                   Nov




                                                                                                                                                                                                                                                               Jul




                                                                                                                                                                                                                                                                                                                      Nov
         Jan


                     Feb


                                      Mar


                                                     Apr




                                                                              Jun




                                                                                                          Aug


                                                                                                                     Sep




                                                                                                                                                                                     Jan


                                                                                                                                                                                              Feb


                                                                                                                                                                                                         Mar
                                                                                                                                    Oct




                                                                                                                                                                                                                         Apr




                                                                                                                                                                                                                                                     Jun




                                                                                                                                                                                                                                                                            Aug


                                                                                                                                                                                                                                                                                       Sep
                                                                                                                                                                    Dec




                                                                                                                                                                                                                                                                                                      Oct




                                                                                                                                                                                                                                                                                                                                     Dec
Source: Bloomberg, Morgan Stanley Research                                                                                                                                Source: Bloomberg Morgan Stanley Research


Exhibit 64                                                                                                                                                                Exhibit 67
Gulf Coast #2 Heating Oil (LLS)                                                                                                                                           Gulf Coast 54-Grade Jet Fuel Crack (LLS)
  $30                               5 Yr Min                     5 Yr Max                       5 Yr Avg                   2010                     2011                    $45                                5 Yr Max                        5 Yr Min                  5 Yr Avg                     2010                    2011

                                                                                                                                                                            $40
  $25
                                                                                                                                                                            $35
  $20
                                                                                                                                                                            $30
  $15                                                                                                                                                                       $25

  $10                                                                                                                                                                       $20

                                                                                                                                                                            $15
   $5
                                                                                                                                                                            $10
   $0
                                                                                                                                                                             $5

  ($5)                                                                                                                                                                       $0
                                                                      May




                                                                                                                                                                                                                                        May
                                                                                           Jul




                                                                                                                                                   Nov




                                                                                                                                                                                                                                                               Jul




                                                                                                                                                                                                                                                                                                                      Nov
         Jan


                     Feb


                                      Mar


                                                     Apr




                                                                              Jun




                                                                                                          Aug


                                                                                                                     Sep




                                                                                                                                                                                                         Mar
                                                                                                                                    Oct




                                                                                                                                                                                     Jan


                                                                                                                                                                                              Feb




                                                                                                                                                                                                                         Apr




                                                                                                                                                                                                                                                     Jun




                                                                                                                                                                                                                                                                            Aug


                                                                                                                                                                                                                                                                                       Sep
                                                                                                                                                                    Dec




                                                                                                                                                                                                                                                                                                      Oct




                                                                                                                                                                                                                                                                                                                                     Dec
Source: Company data, Morgan Stanley Research                                                                                                                             Source: Company data, Morgan Stanley Research


Exhibit 65                                                                                                                                                                Exhibit 68
Ethanol vs. Gasoline Pricing ($/gal)                                                                                                                                      Corn Ethanol Crush Spread ($/gal)
  $4.00                                                                                                                                                                     $3.50                                                       Corn               Ethanol           Crush Spread
                                                           Gasoline                  Ethanol            Gasoline-Ethanol Spread

                                                                                                                                                                            $3.00
  $3.00
                                                                                                                                                                            $2.50

  $2.00
                                                                                                                                                                            $2.00


                                                                                                                                                                            $1.50
  $1.00

                                                                                                                                                                            $1.00

  $0.00
                                                                                                                                                                            $0.50


  ($1.00)                                                                                                                                                                   $0.00


                                                                                                                                                                           ($0.50)
                                                                                                                                                                                     Jul-06




                                                                                                                                                                                                Jan-07




                                                                                                                                                                                                                Jul-07




                                                                                                                                                                                                                               Jan-08




                                                                                                                                                                                                                                                 Jul-08




                                                                                                                                                                                                                                                               Jan-09




                                                                                                                                                                                                                                                                              Jul-09




                                                                                                                                                                                                                                                                                             Jan-10




                                                                                                                                                                                                                                                                                                             Jul-10




                                                                                                                                                                                                                                                                                                                            Jan-11




  ($2.00)
                           Jan-07




                                                             Jan-08




                                                                                               Jan-09




                                                                                                                           Jan-10




                                                                                                                                                           Jan-11
            Jul-06




                                            Jul-07




                                                                            Jul-08




                                                                                                            Jul-09




                                                                                                                                          Jul-10




                                                                                                                                                                          Source: Bloomberg, Morgan Stanley Research
Source: Bloomberg, Morgan Stanley Research




                                                                                                                                                                                                                                                                                                                                           23
                                                                                                                                       MORGAN               STANLEY                     RESEARCH

                                                                                                                                       June 27, 2011
                                                                                                                                       Refining & Marketing




Global Product Crack Spreads
Exhibit 69                                                                                                                             Exhibit 72
Northwest Europe 3:2:1 Crack (Brent)                                                                                                   Singapore 3:2:1 Crack Spread (Dubai)
  $25                                                                                                                                   $30
                           5 Yr Max           5 Yr Min           5 Yr Avg               2010                  2011                                                   5 Yr Max           5 Yr Min           5 Yr Avg          2010           2011


                                                                                                                                        $25
  $20

                                                                                                                                        $20
  $15
                                                                                                                                        $15

  $10
                                                                                                                                        $10


   $5                                                                                                                                    $5


   $0                                                                                                                                    $0




                                                                                                                                                                                May




                                                                                                                                                                                                   Jul
                                                                                                                                                Jan


                                                                                                                                                      Feb




                                                                                                                                                                                          Jun




                                                                                                                                                                                                             Aug


                                                                                                                                                                                                                      Sep




                                                                                                                                                                                                                                          Nov
                                                                                                                                                            Mar


                                                                                                                                                                      Apr




                                                                                                                                                                                                                               Oct




                                                                                                                                                                                                                                                   Dec
                                            May
        Jan


                Feb




                                                      Jun




                                                                          Aug


                                                                                      Sep


                                                                                                  Oct
                                                               Jul




                                                                                                               Nov
                         Mar


                                   Apr




                                                                                                                           Dec




Source: Bloomberg, Morgan Stanley Research                                                                                             Source: Bloomberg, Morgan Stanley Research


Exhibit 70                                                                                                                             Exhibit 73

Northwest Europe 95 RON Gasoline Crack (Brent)                                                                                         Singapore 97 Octane Gasoline Crack (Dubai)
                                                                                                                                         $30                  5 Yr Min            5 Yr Max           5 Yr Avg          2010              2011
  $35
                       5 Yr Min            5 Yr Max            5 Yr Avg                2010                   2011
  $30                                                                                                                                    $25
  $25
                                                                                                                                         $20
  $20

  $15                                                                                                                                    $15

  $10
                                                                                                                                         $10
   $5

   $0                                                                                                                                     $5

   ($5)
                                                                                                                                          $0
  ($10)
                                             May




                                                                Jul
          Jan


                 Feb




                                                         Jun




                                                                            Aug


                                                                                        Sep


                                                                                                    Oct


                                                                                                                 Nov
                          Mar


                                    Apr




                                                                                                                              Dec




                                                                                                                                         ($5)
                                                                                                                                                                                May




                                                                                                                                                                                                   Jul




                                                                                                                                                                                                                                           Nov
                                                                                                                                                Jan


                                                                                                                                                      Feb




                                                                                                                                                                                          Jun




                                                                                                                                                                                                             Aug


                                                                                                                                                                                                                      Sep


                                                                                                                                                                                                                                   Oct
                                                                                                                                                            Mar


                                                                                                                                                                      Apr




                                                                                                                                                                                                                                                   Dec
Source: Bloomberg, Morgan Stanley Research
                                                                                                                                       Source: Bloomberg, Morgan Stanley Research

Exhibit 71
                                                                                                                                       Exhibit 74
Northwest Europe Gasoil Crack (Brent)                                                                                                  Singapore Gasoil Crack (Dubai)
  $35
                                5 Yr Max            5 Yr Min           5 Yr Avg                   2010                 2011              $50
                                                                                                                                                                  5 Yr Max            5 Yr Min           5 Yr Avg           2010           2011

  $30                                                                                                                                    $45

                                                                                                                                         $40
  $25
                                                                                                                                         $35

  $20                                                                                                                                    $30

                                                                                                                                         $25
  $15
                                                                                                                                         $20

  $10                                                                                                                                    $15

                                                                                                                                         $10
   $5
                                                                                                                                          $5

   $0                                                                                                                                     $0
                                              May




                                                                                                                                                                                May




                                                                                                                                                                                                   Jul




                                                                                                                                                                                                                                           Nov
                                                                 Jul




                                                                                                                     Nov




                                                                                                                                                            Mar


                                                                                                                                                                      Apr




                                                                                                                                                                                                             Aug


                                                                                                                                                                                                                      Sep


                                                                                                                                                                                                                                   Oct
          Jan


                Feb




                                                         Jun




                                                                                Aug


                                                                                            Sep


                                                                                                        Oct




                                                                                                                                                Jan


                                                                                                                                                      Feb




                                                                                                                                                                                          Jun




                                                                                                                                                                                                                                                   Dec
                          Mar




                                                                                                                                 Dec
                                    Apr




Note: 5 year range only available since November 2007                                                                                  Source: Bloomberg, Morgan Stanley Research
Source: Company data, Morgan Stanley Research




                                                                                                                                                                                                                                                         24
                                                                                                    MORGAN                          STANLEY                      RESEARCH

                                                                                                    June 27, 2011
                                                                                                    Refining & Marketing




Refinery Crude Throughputs
Exhibit 75                                                                                          Exhibit 78
Total US Refiner Crude Throughputs (mbpd)                                                           PADD 3 (Gulf Coast) Crude Throughputs (mbpd)
                                                                                                      9,000
                        5 Yr Max           5 Yr Min         5 Yr Avg         2010           2011                                            5 Yr Max            5 Yr Min           5 Yr Avg           2010           2011
  16,500
                                                                                                      8,000

  15,500
                                                                                                      7,000

  14,500
                                                                                                      6,000

  13,500
                                                                                                      5,000


  12,500                                                                                              4,000


  11,500                                                                                              3,000




                                                                                                                                                         May
                                                                                                                                      Mar




                                                                                                                                                                                                               Nov
                                                                                                                  Jan


                                                                                                                          Feb




                                                                                                                                                  Apr




                                                                                                                                                                    Jun




                                                                                                                                                                                       Aug


                                                                                                                                                                                               Sep


                                                                                                                                                                                                        Oct
                                                                                                                                                                            Jul




                                                                                                                                                                                                                        Dec
                                     May
                       Mar




                                                                               Oct
                                                      Jul
           Jan


                 Feb




                                                Jun




                                                               Aug


                                                                       Sep




                                                                                     Nov


                                                                                              Dec
                               Apr




                                                                                                    Source: EIA, Morgan Stanley Research
Source: EIA, Morgan Stanley Research

                                                                                                    Exhibit 79
Exhibit 76
PADD 1 (Northeast) Crude Throughputs (mbpd)                                                         PADD 4 (Rockies) Crude Throughputs (mbpd)
                                                                                                      650
  2,000                                                                                                                             5 Yr Max                  5 Yr Min            5 Yr Avg            2010           2011
                         5 Yr Max          5 Yr Min         5 Yr Avg         2010          2011

  1,800
                                                                                                      600

  1,600

                                                                                                      550
  1,400

  1,200
                                                                                                      500
  1,000

   800                                                                                                450


   600
                                                                                                      400
                       Mar




                                     May




                                                                                     Nov
           Jan


                 Feb




                               Apr




                                                Jun




                                                               Aug


                                                                       Sep


                                                                              Oct
                                                      Jul




                                                                                              Dec




                                                                                                                                                        May
                                                                                                                                    Mar


                                                                                                                                                Apr




                                                                                                                                                                                                        Oct


                                                                                                                                                                                                               Nov
                                                                                                            Jan


                                                                                                                        Feb




                                                                                                                                                                   Jun




                                                                                                                                                                                      Aug


                                                                                                                                                                                               Sep




                                                                                                                                                                                                                        Dec
                                                                                                                                                                           Jul




Source: EIA, Morgan Stanley Research                                                                Source: EIA, Morgan Stanley Research

Exhibit 77                                                                                          Exhibit 80
PADD 2 (Mid-Continent) Crude Throughputs (mbpd)                                                     PADD 5 (West Coast) Crude Throughputs (mbpd)
  4,000                                                                                               3,250
                       5 Yr Max            5 Yr Min         5 Yr Avg         2010          2011                                           5 Yr Max              5 Yr Min            5 Yr Avg            2010           2011

  3,750                                                                                               3,000

  3,500
                                                                                                      2,750

  3,250
                                                                                                      2,500

  3,000
                                                                                                      2,250

  2,750
                                                                                                      2,000

  2,500
                                                                                                      1,750
                                     May




                                                      Jul




                                                                              Oct


                                                                                     Nov
           Jan


                 Feb

                       Mar


                               Apr




                                                Jun




                                                               Aug


                                                                       Sep




                                                                                              Dec




                                                                                                                                                          May
                                                                                                                                          Mar


                                                                                                                                                  Apr




                                                                                                                                                                                                               Nov
                                                                                                                  Jan


                                                                                                                              Feb




                                                                                                                                                                     Jun




                                                                                                                                                                                       Aug


                                                                                                                                                                                                Sep


                                                                                                                                                                                                        Oct
                                                                                                                                                                            Jul




                                                                                                                                                                                                                        Dec




Source: EIA, Morgan Stanley Research
                                                                                                    Source: EIA, Morgan Stanley Research




                                                                                                                                                                                                                              25
                                                                                                                  MORGAN                      STANLEY                   RESEARCH

                                                                                                                  June 27, 2011
                                                                                                                  Refining & Marketing




Gasoline Fundamentals
Exhibit 81                                                                                                        Exhibit 83
Implied Gasoline Demand (mbpd)                                                                                    Gasoline Production (mbpd)
  10,500                                                                                                              10,000                        5 Yr Max           5 Yr Min          5 Yr Avg           2010           2011
                          5 Yr Max            5 Yr Min             5 Yr Avg          2010            2011


                                                                                                                       9,500
  10,000


                                                                                                                       9,000

   9,500

                                                                                                                       8,500


   9,000
                                                                                                                       8,000



   8,500                                                                                                               7,500




                                                                                                                                                                 May
                                                                                                                                                Mar
                                                                                                                                        Feb




                                                                                                                                                                                                                     Nov


                                                                                                                                                                                                                              Dec
                                                                                                                                Jan




                                                                                                                                                                            Jun




                                                                                                                                                                                             Aug


                                                                                                                                                                                                     Sep
                                                                                                                                                                                   Jul
                                                                                                                                                          Apr




                                                                                                                                                                                                              Oct
                                            May
                          Mar




                                                                                      Oct
           Jan


                   Feb




                                                       Jun


                                                             Jul


                                                                       Aug


                                                                              Sep




                                                                                             Nov


                                                                                                          Dec
                                     Apr




Source: EIA, Morgan Stanley Research                                                                              Source: EIA, Morgan Stanley Research

Exhibit 82                                                                                                        Exhibit 84
Gasoline Stocks (mbbl)                                                                                            Gasoline Imports (mbpd)
  250,000                   5 Yr Max              5 Yr Min         5 Yr Avg         2010           2011               1,800
                                                                                                                                                    5 Yr Max           5 Yr Min          5 Yr Avg          2010       2011

                                                                                                                      1,600

                                                                                                                      1,400
  225,000
                                                                                                                      1,200

                                                                                                                      1,000

  200,000                                                                                                              800

                                                                                                                       600

                                                                                                                       400
  175,000
                                                                                                                                              Mar




                                                                                                                                                                May
                                                                                                                                                         Apr




                                                                                                                                                                                                                     Nov
                                                                                                                              Jan


                                                                                                                                      Feb




                                                                                                                                                                           Jun


                                                                                                                                                                                   Jul


                                                                                                                                                                                             Aug


                                                                                                                                                                                                     Sep


                                                                                                                                                                                                              Oct




                                                                                                                                                                                                                                  Dec
                                            May
                           Mar
                    Feb




                                                                                            Nov


                                                                                                      Dec
             Jan




                                                       Jun




                                                                      Aug


                                                                              Sep
                                                             Jul
                                      Apr




                                                                                     Oct




Source: EIA, Morgan Stanley Research                                                                              Source: EIA, Morgan Stanley Research


Exhibit 85
Gasoline Days of Inventory
   30
                                                                   5 Yr Max                 5 Yr Min             5 Yr Avg                       2010                        2011
   28

   26

   24

   22

   20

   18
     Jan                  Feb               Mar                    Apr              May               Jun       Jul                 Aug                Sep                  Oct                    Nov              Dec

Source: EIA, Morgan Stanley Research




                                                                                                                                                                                                                                        26
                                                                                                                                           MORGAN                             STANLEY                          RESEARCH

                                                                                                                                           June 27, 2011
                                                                                                                                           Refining & Marketing




Distillate Fundamentals
Exhibit 86                                                                                                                                 Exhibit 88
Implied Distillate Demand (mbpd)                                                                                                           Distillate Production (mbpd)
  5,500                                                                                                                                        5,000
                                  5 Yr Max                  5 Yr Min               5 Yr Avg             2010           2011                                                         5 Yr Max                 5 Yr Min            5 Yr Avg            2010                 2011



  5,000                                                                                                                                        4,500



  4,500                                                                                                                                        4,000



  4,000                                                                                                                                        3,500



  3,500                                                                                                                                        3,000
                                                          May
                                  Mar




                                                                                                                     Nov
                                              Apr
                      Feb




                                                                             Jul




                                                                                                           Oct




                                                                                                                              Dec
          Jan




                                                                     Jun




                                                                                        Aug


                                                                                                 Sep




                                                                                                                                                                                                       May
                                                                                                                                                                                    Mar


                                                                                                                                                                                              Apr




                                                                                                                                                                                                                                                     Oct


                                                                                                                                                                                                                                                              Nov
                                                                                                                                                           Jan


                                                                                                                                                                        Feb




                                                                                                                                                                                                                  Jun


                                                                                                                                                                                                                          Jul


                                                                                                                                                                                                                                   Aug


                                                                                                                                                                                                                                             Sep




                                                                                                                                                                                                                                                                           Dec
Source: EIA, Morgan Stanley Research                                                                                                       Source: EIA, Morgan Stanley Research

Exhibit 87                                                                                                                                 Exhibit 89
Distillate Stocks (mbbl)                                                                                                                   Distillate Imports (mbpd)
  200,000
                                                                                                                                               800
                                          5 Yr Max                5 Yr Min            5 Yr Avg            2010             2011                                                           5 Yr Max            5 Yr Min          5 Yr Avg           2010            2011
                                                                                                                                               700
  180,000
                                                                                                                                               600

  160,000                                                                                                                                      500

                                                                                                                                               400
  140,000
                                                                                                                                               300

                                                                                                                                               200
  120,000
                                                                                                                                               100

  100,000                                                                                                                                        0
                                                            May




                                                                                                               Oct
                                        Mar




                                                                               Jul




                                                                                                                     Nov


                                                                                                                               Dec
                Jan


                            Feb




                                                    Apr




                                                                       Jun




                                                                                           Aug


                                                                                                  Sep




                                                                                                                                                                                                     May
                                                                                                                                                                              Mar




                                                                                                                                                                                                                         Jul
                                                                                                                                                     Jan




                                                                                                                                                                                                                                                     Oct
                                                                                                                                                                  Feb




                                                                                                                                                                                            Apr




                                                                                                                                                                                                                Jun




                                                                                                                                                                                                                                  Aug


                                                                                                                                                                                                                                            Sep




                                                                                                                                                                                                                                                             Nov


                                                                                                                                                                                                                                                                           Dec
Source: EIA, Morgan Stanley Research                                                                                                       Source: EIA, Morgan Stanley Research



Exhibit 90
Distillate Days of Inventory
   50
                                                                                           5 Yr Max                           5 Yr Min           5 Yr Avg                                         2010                         2011

   45

   40

   35

   30

   25

   20
     Jan                           Feb                      Mar                      Apr                 May                  Jun        Jul                     Aug                        Sep                   Oct                    Nov                Dec


Source: EIA, Morgan Stanley Research




                                                                                                                                                                                                                                                                                 27
                                                                                                                            MORGAN                         STANLEY                               RESEARCH

                                                                                                                            June 27, 2011
                                                                                                                            Refining & Marketing




Other Refined Product Market Fundamentals
Exhibit 91                                                                                                                  Exhibit 94
Total US Refining Utilization Rate (%)                                                                                      Total US Implied Refined Product Demand (% YoY)
  100                                                                                                                        10%                                                               4-WK MA YoY                 13-WK MA YoY
                                        5 Yr Max           5 Yr Min          5 Yr Avg           2010       2011

   95
                                                                                                                              5%
   90


   85                                                                                                                         0%


   80
                                                                                                                             -5%
   75


   70                                                                                                                       -10%


   65
                                                   May
                                Mar


                                           Apr
        Jan


                    Feb




                                                              Jun


                                                                      Jul


                                                                                Aug


                                                                                         Sep


                                                                                                  Oct


                                                                                                         Nov


                                                                                                                      Dec




                                                                                                                            -15%
                                                                                                                               May-06         Nov-06       May-07         Nov-07           May-08            Nov-08      May-09       Nov-09           May-10          Nov-10          May-11

Source: EIA, Morgan Stanley Research
                                                                                                                            Source: EIA, Morgan Stanley Research

Exhibit 92
                                                                                                                            Exhibit 95
Implied Jet-Kerosene Fuel Demand (mbpd)                                                                                     Total US Refined Product Stocks (MMbbl)
  2,000
                                      5 Yr Max           5 Yr Min            5 Yr Avg           2010           2011                                         5 Yr Max                           5 Yr Min                  5 Yr Avg                      2010                  2011
                                                                                                                              800

  1,800

                                                                                                                              750
  1,600


                                                                                                                              700
  1,400



  1,200                                                                                                                       650



  1,000
                                                                                                                              600
                                                     May




                                                                                                         Nov
                                  Mar


                                             Apr




                                                                                                   Oct




                                                                                                                      Dec
              Jan


                          Feb




                                                                Jun




                                                                                  Aug


                                                                                          Sep
                                                                       Jul




                                                                                                                                                                                         May
                                                                                                                                                           Mar


                                                                                                                                                                          Apr




                                                                                                                                                                                                                 Jul




                                                                                                                                                                                                                                                        Oct
                                                                                                                                     Jan


                                                                                                                                                Feb




                                                                                                                                                                                                       Jun




                                                                                                                                                                                                                            Aug


                                                                                                                                                                                                                                        Sep




                                                                                                                                                                                                                                                                       Nov


                                                                                                                                                                                                                                                                                      Dec
Source: IEA, Morgan Stanley Research                                                                                        Source: Department of Transportation, Morgan Stanley Research


Exhibit 93                                                                                                                  Exhibit 96
US Propylene Stocks, non-fuel use (mbbl)                                                                                    US Vehicle Miles Traveled (YoY%)
                                                                                                                             5.0%                                                    YoY (Current Month)                     YoY (3 Month MA)
  5,000
                                       5 Yr Max            5 Yr Min           5 Yr Avg          2010           2011
                                                                                                                             4.0%
  4,500
                                                                                                                             3.0%
  4,000
                                                                                                                             2.0%
  3,500
                                                                                                                             1.0%
  3,000
                                                                                                                             0.0%
  2,500
                                                                                                                             -1.0%
  2,000
                                                                                                                             -2.0%
  1,500
                                                                                                                             -3.0%
  1,000                                                                                                                      -4.0%

   500                                                                                                                       -5.0%
                                                                                                                                     Jul-06



                                                                                                                                                  Jan-07



                                                                                                                                                                 Jul-07



                                                                                                                                                                                Jan-08



                                                                                                                                                                                                  Jul-08



                                                                                                                                                                                                                Jan-09



                                                                                                                                                                                                                             Jul-09



                                                                                                                                                                                                                                              Jan-10



                                                                                                                                                                                                                                                              Jul-10



                                                                                                                                                                                                                                                                             Jan-11




        0
                                                    May




                                                                       Jul




                                                                                                         Nov
            Jan


                      Feb




                                                               Jun




                                                                                 Aug


                                                                                         Sep


                                                                                                   Oct
                                             Apr




                                                                                                                      Dec
                                  Mar




                                                                                                                            Source: Department of Transportation, Morgan Stanley Research;
                                                                                                                            Note, data released after a two month lag
Source: EIA, Morgan Stanley Research




                                                                                                                                                                                                                                                                                            28
                                                                                  MORGAN        STANLEY        RESEARCH

                                                                                  June 27, 2011
                                                                                  Refining & Marketing




Exhibit 97
US Refining and Marketing Comparable Metrics
                                                                 Ratings and Capitalization
                    6/24/2011                    Price   Equity Enterprise    Div.           Net Debt / Cap          Net Refining Margin / Barrel
                         Price      Rating      Target    Value    Value     Yield       2010E    2011E     2012E       2010E     2011E     2012E
      VLO              $23.18        E          $27.00   13,213   18,216     0.8%          25%      14%        8%       $3.54     $5.64     $5.12
      TSO              $20.84        E          $25.00    2,992     4,339    0.0%          30%      17%        9%       $3.40     $6.56     $4.99
      SUN              $39.15        O          $50.00    4,741     6,438    1.5%          36%      37%       30%      ($0.20)    $0.35     $1.51
      WNR              $16.24        O          $18.00    1,447     2,456    0.0%          60%      46%       32%       $3.53    $11.48     $8.70
      ALJ              $10.22        U           $8.00      567     1,451    1.5%          75%      68%       68%      ($2.15)    $4.02     $2.06
      DK               $14.01        E           $9.00      763     1,010    1.1%          36%      17%        4%       $1.44     $8.45     $5.80
      Average                                                                0.8%          43%      33%       25%       $1.60     $6.09     $4.70

                                                                          Operations
                      Refining Capacity (mbpd)               Utilization Rate            $ Gross Margin / Barrel           $ Opex / Barrel
                       2010E      2011E     2012E        2010E      2011E     2012E     2010E     2011E     2012E      2010E   2011E       2012E
      VLO              2,780      2,595     2,595          77%        85%       84%      $7.80     $9.74     $9.34     $4.26   $4.10       $4.22
      TSO                 665       665       665          72%        85%       84%     $11.27   $12.65     $10.90     $7.87   $6.09       $5.91
      SUN                 675       505       505          96%        89%       93%      $5.04     $5.13     $5.76     $5.24   $4.77       $4.25
      WNR                 151       153       154         138%        93%       97%      $8.88   $16.98     $14.09     $5.34   $5.50       $5.39
      ALJ                 247       247       247          43%        57%       64%      $5.06     $9.52     $7.50     $7.20   $5.50       $5.43
      DK                   60        60        60          90%        95%       94%      $7.00   $13.70     $10.56     $5.56   $5.25       $4.76
      Average                                              86%        84%       86%      $7.51   $11.29      $9.69     $5.91   $5.20       $4.99

                                                                          Valuation
                          Price / Earnings                Price / Cons Earnings               EV / EBITDA                EV / Cons EBITDA
                        2010E     2011E    2012E         2010E     2011E     2012E       2010E     2011E  2012E        2010E    2011E   2012E
      VLO                15.8x      5.7x     7.7x         14.3x      6.4x      6.1x        5.6x      3.4x   4.0x         5.4x     3.7x    3.5x
      TSO                 NM        6.0x     8.2x           NM       6.6x      7.5x        8.3x      3.2x   3.9x         8.0x     3.2x    3.5x
      SUN                19.9x     28.8x    12.0x         21.9x     59.1x     17.0x        5.2x      6.7x   5.2x         6.4x     8.0x    6.6x
      WNR                 NM        6.5x     8.2x           NM       6.1x      6.6x        9.6x      4.3x   5.1x         9.5x     3.8x    4.1x
      ALJ                 NM       12.9x     NM             NM      14.2x      9.8x        NM        6.2x   9.6x          NM      5.5x    5.1x
      DK                  NM        9.0x    13.0x           NM      10.7x     14.4x       15.2x      4.6x   5.6x        15.4x     4.7x    5.5x
      Average            17.9x     11.5x     9.8x         18.1x     17.2x     10.3x        8.8x      4.7x   5.6x         9.0x     4.8x    4.7x

                                                             Morgan Stanley Versus Consensus
                          MS EPS Estimates               Consensus EPS Estimate          MS EBITDA ($MM)              Consensus EBITDA ($MM)
                         2010E   2011E     2012E          2010E   2011E     2012E     2010E    2011E   2012E           2010E    2011E    2012E
      VLO                $1.47   $4.00     $2.97          $1.62   $3.62     $3.78      3,258    5,414   4,525           3,352    4,936    5,182
      TSO               ($0.33)  $3.46     $2.52         ($0.29)  $3.15     $2.79        524    1,376   1,124             543    1,336    1,229
      SUN                $1.98   $1.36     $3.27          $1.79   $0.66     $2.30      1,229      960   1,239             999      805      977
      WNR               ($0.05)  $2.50     $1.98         ($0.11)  $2.67     $2.45        257      569     482             260      641      598
      ALJ               ($2.48)  $0.77    ($0.15)        ($2.41)  $0.72     $1.04        -51      235     151             -41      266      283
      DK                ($0.36)  $1.54     $1.07         ($0.36)  $1.31     $0.97         66      222     179              65      216      185
Source: Company data, Morgan Stanley Research




Valuation Methodology and Risks. Our price targets are based on 2011 EV/EBITDA multiples. Forecast target multiples are
compressed compared to historical periods owing to outsized profitability of much higher crude differentials. While SUN is valued at a
sum of the parts, including: refining at long term historic EV/EBITDA, DCF and Liquidation value, retail- long term EV/EBITDA multiple,
SunCoke - blended EV/EBITDA historic multiple broken out from met coal and coke, Logistics-Discounted Cash flow and Chemical on
historic EV/EBITDA multiple. Risks to our price targets include lower refined product prices, crude oil and natural gas prices, inability
for operators to maintain refinery and midstream assets performance.




                                                                                                                                                    29
                                                                   MORGAN        STANLEY          RESEARCH

                                                                   June 27, 2011
                                                                   Refining & Marketing




Coverage Team, Refining Publications & Content Index
North American Integrated Oil and Refining Coverage Team
Evan Calio                                 Evan.Calio@MorganStanley.com                                       (212) 761-6472
    Ben Hur                                Ben.Hur@MorganStanley.com                                          (212) 761-7827
    Marko Lazarevic                        Marko.Lazarevic@MorganStanley.com                                  (212) 761-3692
    Todd Firestone                         Todd.Firestone@MorganStanley.com                                   (212) 761-7674
Exhibit 98
Refining and Marketing Publications                                                       Content index            Date
Crude Oil: IEA Announcement Bearish Crude                                                 Coverage Universe      23-Jun-11
Ethanol: Subsidy in the Crosshairs & Broader Issues                                       Coverage Universe      20-Jun-11
Breaking Down the Break-Up: Valuing MRO and MPC Ahead of July 1 Separation                MRO                    17-Jun-11
The Hurricane Impact and Updating 2Q11 Estimates                                          Coverage Universe      10-Jun-11
Show Me the Money: Separation to Highlight Value                                          SUN                      7-Jun-11
Mergers, Spin-offs and IPOs at end of 2Q11                                                Coverage Universe        3-Jun-11
Libyan Crude Outage Will Amplify Crude Differentials                                      Coverage Universe      27-May-11
Corporate Access Day Wrap: More than Seasonal Strength                                    Coverage Universe      20-May-11
Positive Earnings Revisions and Mississippi River Update                                  Coverage Universe      13-May-11
Three More Black Swans: Keystone, Ozark & Mississippi River                               Coverage Universe      10-May-11
Mid-Con Earnings Power and SunCoke Expansion                                              Coverage Universe       9-May-11
New Cushing Pipeline Offsets Bullish (VLO) Outlook                                        Coverage Universe       2-May-11
This Week in Refining: VLO and TSO Takeaways                                              Coverage Universe       21-Apr-11
Integrated Oil and Refining: Stick With Crude Leverage and Mid-Con Exposure               Coverage Universe       15-Apr-11
This Week in Refining: Debate Over Global Demand                                          Coverage Universe       15-Apr-11
This Week in Refining: Focus on 1Q11 EPS Revisions                                        Coverage Universe        8-Apr-11
This Week in Refining: Bullish LatAm Distillate Demand                                    Coverage Universe        1-Apr-11
This Week in Refining: What's in the Mid-Con Price?                                       Coverage Universe      25-Mar-11
SunCoke Separation: Focus on the Cash                                                     SUN                    24-Mar-11
This Week in Refining: Another Black Swan?                                                Coverage Universe      18-Mar-11
Balanced Risked-Reward; Downgrading to Equal-weight                                       TSO                    15-Mar-11
Earthquake and Asset Sale                                                                 Coverage Universe      14-Mar-11
This Week in Refining: Macro Headwinds Offsetting 1Q11 Earnings Trends                    Coverage Universe      11-Mar-11
Houston Bus Tour Highlights                                                               FTO                    10-Mar-11
Washington D.C. Trip: Drill Baby, Drill Maybe?                                            Coverage Universe        7-Mar-11
Holly Frontier Merger Creates Largest Mid-con Pure-play                                   FTO, HOC               23-Feb-11
Crude Oil: Secular Challenges at Cushing                                                  Coverage Universe      17-Feb-11
Mid Con Refining: On the Toll Road of Production Growth                                   Coverage Universe        3-Feb-11
Value to Growth Company: Upside Remains in 2011                                           SUN                    18-Jan-11
MLP Filing Confirms Our View: More Value to Unlock                                        TSO                      5-Jan-11
Restructuring and Re-rating Upside Remain                                                 TSO                    14-Dec-10
SUN-BURST: Toledo Sale, Met Coal Reset in 1Q11                                            SUN                      3-Dec-10
The Next Value Unlock: Upgrading to Overweight                                            TSO                    22-Nov-10
3Q10 Earnings: Deleveraging in Motion                                                     WNR                      4-Nov-10
Coke Outlook Brightens while Refining Weakens                                             SUN                     29-Oct-10
Earnings Beat and Positive Outlook Limits Downside                                        VLO                     26-Oct-10
Refining & Marketing: 3Q10 Earnings Look Promising; 4Q10E Neutral                         Coverage Universe       19-Oct-10
Deleveraging, Restructuring Drive Upside; Overweight                                      WNR                     13-Oct-10
COKE Deep Dive; Market Undervaluing SUN SOTP                                              SUN                      5-Oct-10
Exiting PADD 1 with Paulsboro Sale                                                        VLO                    28-Sep-10
Source: Morgan Stanley Research




                                                                                                                          30
                                                                       MORGAN        STANLEY       RESEARCH

                                                                       June 27, 2011
                                                                       Refining & Marketing




Morgan Stanley is acting as financial advisor to Holly Corporation ("Holly") in relation to the proposed merger with Frontier Oil
Corporation ("Frontier"), as announced on February 22, 2011.

The proposed transaction is subject to the approval of Holly and Frontier shareholders, regulatory approvals, and other customary
closing conditions. This report and the information provided herein is not intended to (i) provide voting advice, (ii) serve as an
endorsement of the proposed transaction, or (iii) result in the procurement, withholding or revocation of a proxy or any other action by
a security holder.

Holly has agreed to pay fees to Morgan Stanley for its financial services, including transaction fees that are contingent upon the
consummation of the proposed transaction

Morgan Stanley is currently acting as financial advisor to Marathon Oil Corporation ("Marathon") with respect to the proposed spin-off
of its downstream business as announced on [January 13th, 2011]. The spin-off is subject to regulatory approvals and other
customary closing conditions. Marathon has agreed to pay fees to Morgan Stanley for its financial advisory services, including
transaction fees and financing fees that are contingent upon the consummation of the proposed spin-off. Please refer to the notes at
the end of the report.




                                                                                                                                     31
                                                                                MORGAN         STANLEY         RESEARCH

                                                                                June 27, 2011
                                                                                Refining & Marketing




                                                       Disclosure Section
The information and opinions in Morgan Stanley Research were prepared by Morgan Stanley & Co. LLC, and/or Morgan Stanley C.T.V.M. S.A., and/or
Morgan Stanley Mexico, Casa de Bolsa, S.A. de C.V. As used in this disclosure section, "Morgan Stanley" includes Morgan Stanley & Co. LLC,
Morgan Stanley C.T.V.M. S.A., Morgan Stanley Mexico, Casa de Bolsa, S.A. de C.V. and their affiliates as necessary.
For important disclosures, stock price charts and equity rating histories regarding companies that are the subject of this report, please see the Morgan
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Analyst Certification
The following analysts hereby certify that their views about the companies and their securities discussed in this report are accurately expressed and
that they have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this
report: Evan Calio.
Unless otherwise stated, the individuals listed on the cover page of this report are research analysts.
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Important US Regulatory Disclosures on Subject Companies
As of May 31, 2011, Morgan Stanley beneficially owned 1% or more of a class of common equity securities of the following companies covered in
Morgan Stanley Research: Delek US Holdings Inc, Sunoco, Inc., Tesoro Corp, Western Refining Inc..
Within the last 12 months, Morgan Stanley managed or co-managed a public offering (or 144A offering) of securities of Marathon Oil Corporation.
Within the last 12 months, Morgan Stanley has received compensation for investment banking services from Holly Corporation, Marathon Oil
Corporation, Sunoco, Inc., Tesoro Corp, Valero Energy Corporation.
In the next 3 months, Morgan Stanley expects to receive or intends to seek compensation for investment banking services from Frontier Oil
Corporation, Holly Corporation, Marathon Oil Corporation, Sunoco, Inc., Tesoro Corp, Valero Energy Corporation.
Within the last 12 months, Morgan Stanley has received compensation for products and services other than investment banking services from
Marathon Oil Corporation, Tesoro Corp, Valero Energy Corporation, Western Refining Inc..
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Certain disclosures listed above are also for compliance with applicable regulations in non-US jurisdictions.
STOCK RATINGS
Morgan Stanley uses a relative rating system using terms such as Overweight, Equal-weight, Not-Rated or Underweight (see definitions below).
Morgan Stanley does not assign ratings of Buy, Hold or Sell to the stocks we cover. Overweight, Equal-weight, Not-Rated and Underweight are not the
equivalent of buy, hold and sell. Investors should carefully read the definitions of all ratings used in Morgan Stanley Research. In addition, since
Morgan Stanley Research contains more complete information concerning the analyst's views, investors should carefully read Morgan Stanley
Research, in its entirety, and not infer the contents from the rating alone. In any case, ratings (or research) should not be used or relied upon as
investment advice. An investor's decision to buy or sell a stock should depend on individual circumstances (such as the investor's existing holdings)
and other considerations.
Global Stock Ratings Distribution
(as of May 31, 2011)
For disclosure purposes only (in accordance with NASD and NYSE requirements), we include the category headings of Buy, Hold, and Sell alongside
our ratings of Overweight, Equal-weight, Not-Rated and Underweight. Morgan Stanley does not assign ratings of Buy, Hold or Sell to the stocks we
cover. Overweight, Equal-weight, Not-Rated and Underweight are not the equivalent of buy, hold, and sell but represent recommended relative
weightings (see definitions below). To satisfy regulatory requirements, we correspond Overweight, our most positive stock rating, with a buy
recommendation; we correspond Equal-weight and Not-Rated to hold and Underweight to sell recommendations, respectively.

                         Coverage Universe    Investment Banking Clients (IBC)
                                        % of                   % of % of Rating
Stock Rating Category       Count       Total     Count Total IBC Category
Overweight/Buy              1153         41%         464        48%         40%
Equal-weight/Hold           1140         41%         365        38%         32%
Not-Rated/Hold                108         4%           20        2%         19%
Underweight/Sell              390        14%         108        11%         28%
Total                       2,791                    957




                                                                                                                                                    32
                                                                                              MORGAN            STANLEY           RESEARCH

                                                                                              June 27, 2011
                                                                                              Refining & Marketing




Data include common stock and ADRs currently assigned ratings. An investor's decision to buy or sell a stock should depend on individual
circumstances (such as the investor's existing holdings) and other considerations. Investment Banking Clients are companies from whom Morgan
Stanley received investment banking compensation in the last 12 months.
Analyst Stock Ratings
Overweight (O). The stock's total return is expected to exceed the average total return of the analyst's industry (or industry team's) coverage universe,
on a risk-adjusted basis, over the next 12-18 months.
Equal-weight (E). The stock's total return is expected to be in line with the average total return of the analyst's industry (or industry team's) coverage
universe, on a risk-adjusted basis, over the next 12-18 months.
Not-Rated (NR). Currently the analyst does not have adequate conviction about the stock's total return relative to the average total return of the
analyst's industry (or industry team's) coverage universe, on a risk-adjusted basis, over the next 12-18 months.
Underweight (U). The stock's total return is expected to be below the average total return of the analyst's industry (or industry team's) coverage
universe, on a risk-adjusted basis, over the next 12-18 months.
Unless otherwise specified, the time frame for price targets included in Morgan Stanley Research is 12 to 18 months.
Analyst Industry Views
Attractive (A): The analyst expects the performance of his or her industry coverage universe over the next 12-18 months to be attractive vs. the
relevant broad market benchmark, as indicated below.
In-Line (I): The analyst expects the performance of his or her industry coverage universe over the next 12-18 months to be in line with the relevant
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                                                                                             June 27, 2011
                                                                                             Refining & Marketing




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Industry Coverage:Refining & Marketing

Company (Ticker)                              Rating (as of) Price* (06/24/2011)


Evan Calio
Alon USA Energy, Inc. (ALJ.N)                U (10/15/2009)                   $10.22
Delek US Holdings Inc (DK.N)                 E (02/02/2011)                   $14.01
Frontier Oil Corporation (FTO.N)                         ++                   $28.68
Holly Corporation (HOC.N)                                ++                   $59.81
Sunoco, Inc. (SUN.N)                         O (10/15/2009)                   $39.15
Tesoro Corp (TSO.N)                          E (03/15/2011)                   $20.84
Valero Energy Corporation (VLO.N)            E (10/15/2009)                   $23.18
Western Refining Inc. (WNR.N)                O (10/13/2010)                   $16.24

Stock Ratings are subject to change. Please see latest research for each company.
* Historical prices are not split adjusted.




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