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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
                October 14, 2011                                                                                  Marko.Lazarevic@morganstanley.com
                                                                                                                  +1 (1)(212) 761 3692


Industry View   Refining & Marketing                                                                              Todd Firestone
                                                                                                                  Jacob Dweck
Attractive
                Ten-Week Streak Broken
                                                                              Inside This Week in Refining                                       Page
                Cushing Fills 532kbbls                                        Investment Perspectives
                                                                              Earnings Calendar
                                                                                                                                                   2
                                                                                                                                                   3
                                                                              Earnings Estimates and Equity Performance                            5
                Overall, light sweet crude markets will likely narrow         WTI Versus Waterborne Crude Oil Prices                               7
                the WTI LLS spread with incremental supply growth,            Weekly EIA Petroleum Status Report                                   8
                                                                              Weekly Crack Spread Performance                                      9
                yet increased Cushing Storage into YE provides
                                                                              Refining Sector: Thesis, Themes and Ratings                         10
                downside support to WTI LLS at $20/bbl.                       Commodity and Economic Forecasts                                    13
                                                                              Crude Oil Markets and Fundamentals                                  15
                Cushing tightens this week widening WTI LLS to                US and Global Refined Product Crack Spreads                         18
                $29/bbl and provides downside support to $20/bbl.             Refined Product Fundamentals                                        24
                This week in refining Cushing storage filled 532kbbls for     Refining and Marketing Comparable Metrics                           28
                the first time in 10 weeks and we believe that it will        Publications and Content Index                                      29
                                                                              Disclosures                                                         30
                continue to fill into year-end providing downside support
                WTI LLS differentials of $20/bbl. Based on our
                proprietary Cushing Balance model, we expect Cushing
                storage to increase by 10-15mmbbls by YE, which is
                ~78% of operable capacity. The major factors that
                contribute to the filling of Cushing that will occur in the
                next few months include: 1) ~113kbpd of incremental
                Canadian volumes by 4Q11, 2) 42kbpd of incremental
                Bakken volumes by 4Q11 and 3) 218kbpd of planned
                Mid-con turnarounds in 4Q11 that includes COP Ponca
                City (Oct-Nov), BP Whiting (Oct-Dec) and CVI
                Coffeyville (Oct-Nov).

                Global light sweet crude supply tightens with                 Canadian Energy Conference
                                                                              November 7 - November 9, 2011 - Calgary, Alberta Canada
                Nigerian Force Majeure but likely narrows into YE.            To register, please contact your Morgan Stanley Representative

                WTI LLS differentials maintained their $29/bbl avg. this
                week due to Shell’s announced 200kbpd Force Majeure
                on the sabotaged Forcados pipeline that tightened light
                sweet crude supplies globally. We continue to expect
                WTI LLS to narrow into YE as nearly 300kbpd of net light
                sweet crude comes to market of which: 685kbpd QoQ
                incremental supply comes from the North Sea
                (maintenance and Skarv), Libya, Angola (Pazflor) and
                Nigeria that is offset by 385kbpd of incremental QoQ
                global demand mainly from Japan to meet power needs.          Morgan Stanley does and seeks to do business with
                                                                              companies covered in Morgan Stanley Research. As
                Refiners outperform the S&P500 and energy for the             a result, investors should be aware that the firm may
                2nd week in a row. Week to date, refiners are up 13%,         have a conflict of interest that could affect the
                more than the energy sector by 6% and S&P by 9%.              objectivity of Morgan Stanley Research. Investors
                                                                              should consider Morgan Stanley Research as only a
                Crack spreads from major US regions rose ~7% on               single factor in making their investment decision.
                average week-on-week. Crude differentials widened:
                                                                              For analyst certification and other important
                LLS-WTI +7%, LLS-Maya +11% and LLS-Mars +21%.                 disclosures, refer to the Disclosure Section,
                                                                              located at the end of this report.
                                                                                                                                                                                                                    MORGAN        STANLEY       RESEARCH

                                                                                                                                                                                                                    October 14, 2011
                                                                                                                                                                                                                    Refining & Marketing




Investment Perspectives
Exhibit 1                                                                                                                                                                                                           Weekly DOE report shows lower utilization and inline
Weekly Equity Performance                                                                                                                                                                                           implied demand. Refinery utilization decreased 3.5% this
                                                                                                                                                                                      WNR, 13.5%                    week to 84.2% as PADD 3 fell by 2.5% and declined only in
                                                                                                                                                                                                                    PADD 4 by 5.2% to 86.3%. Crude oil stocks increased
                                                                                                                                                                                DK, 12.5%
                                                                                                                                                                                                                    1.3mmbbls this week, with Cushing filling, for the first time in 10
                                                                                                                                                                      VLO, 11.6%
                                                                                                                                                                                                                    weeks, by 532kbbls (1.8%) to 337.6mmbbls. Refined product
                                                                                                                                                           CVR, 11.0%                                               stocks decreased 2.8mmbbls this week, while total implied
                                                                                                                                               ALJ, 9.6%
                                                                                                                                                                                                                    product demand decreased 364kbpd from last week and up
                                                                                                                                                                                                                    69kbpd YoY (0.4% YoY on a 4-wk avg. basis). Gasoline
                                                                                                                                        US R&M, 8.8%
                                                                                                                                                                                                                    implied demand increased 1.7% WoW, as stocks decreased by
                                                                                                                                   TSO, 8.3%                                                                        2.7mmbbls with imports falling 50.6% WoW. Implied demand
                                                                                                                               NES1V (EU),                                                                          for distillate fuel fell by 0.6%, remaining above the 5-yr range.
                                                                                                                                  8.1%
                                                                                                                                                                                                                    Jet fuel implied demand rose 1.9% WoW, while other refined
                                                                                                                        HFC, 7.4%
                                                                                                                                                                                                                    products demand fell 0.1%.
                                                                                                                       SRS (EU), 7.0%

                                                                                                     PPHN (EU), 5.5%                                                                                                Harvest pipeline in Eagle Ford that will supply VLO on
                                                                                       Euro R&M, 5.0%
                                                                                                                                                                                                                    track. The construction of the Harvest Pipeline is 60%
                                                                                                                                                                                                                    complete (full capacity 90kbpd Three Rivers pipeline) and is
                                                                                    Oil Svcs, 4.3%
                                                                                                                                                                                                                    expected to be finished by the end of the month. However, the
                                                                                    E&P, 4.2%                                                                                                                       pipeline will not be operational until January 2012, due to
                                                                        Energy, 3.7%                                                                                                                                electricity constraints in Texas.
                                                                       SUN, 3.6%
                                                                                                                                                                                                                    Shell partially restarts its 500kbpd Singapore refinery.
                                                                     S&P 500, 3.3%                                                                                                                                  Shell has begun the restart of the 500kbpd Singapore refinery
                                                                    MLP's, 3.1%
                                                                                                                                                                                                                    with 100kbpd of capacity back online that should help tighter
                                                                                                                                                                                                                    Asian and Westcoast products and reduce regional affected
                                                                   Int. Oil, 2.9%
                                                                                                                                                                                                                    margins.
                                                   MPC, 1.4%
                                                                                                                                                                                                                    Libyan crude production reaches ~400kbpd. National Oil
  0%                                                                                 5%                                                   10%                                                        15%            Company head, Nuri Berruein hopes to have ~1mmbpd of
Source: FactSet, Morgan Stanley Research, From Oct 6, to Sept 13, 2011                                                                                                                                              Libyan production within the next five months, while the IEA
                                                                                                                                                                                                                    predicts ~1.1mmbpd by YE2012 based on an increased finding
Exhibit 2                                                                                                                                                                                                           of damages on infrastructure.
Historical Refining Performance Versus Market
                                                                                           Refining                        Energy                       S&P 500
                                                                                                                                                                                                                    Chevron 3Q interim update downstream highlights. CVX
                                200
                                                                                                                                                                                                                    posted its 3Q interim update that provided insight on global
                                180
                                                                                                                                                                                                                    refining margins. Year-over-year US Gulf Coast Maya 5-3-1-1
                                160
                                                                                                                                                                                                                    margins are $7-8/bbl higher, Singapore 3-1-1-1 margins are
  Indexed Value (start = 100)




                                140

                                120
                                                                                                                                                                                                                    $1-2/bbl higher and US West Coast 5-3-1-1 margins are
                                100
                                                                                                                                                                                                                    $ 2.5/bbl lower. Thru August, refining inputs were 29kbpd
                                80
                                                                                                                                                                                                                    higher in the US at 904kbpd while international runs were lower
                                60
                                                                                                                                                                                                                    at 943kbpd mainly due to the loss of Pembroke and
                                40                                                                                                                                                                                  turnarounds. The company has completed its sale of
                                20                                                                                                                                                                                  Pembroke for $500mm.
                                 0
                                      10/13/2006



                                                      04/13/2007



                                                                       10/12/2007



                                                                                        04/11/2008



                                                                                                          10/10/2008



                                                                                                                           04/09/2009



                                                                                                                                           10/09/2009



                                                                                                                                                         04/09/2010



                                                                                                                                                                         10/08/2010



                                                                                                                                                                                        04/08/2011



                                                                                                                                                                                                       10/07/2011




Source: FactSet, Morgan Stanley Research
Note: Energy and Refining represent equal-weighted indices




                                                                                                                                                                                                                                                                                    2
                                                                            MORGAN        STANLEY        RESEARCH

                                                                            October 14, 2011
                                                                            Refining & Marketing




Earnings Calendar
Exhibit 3
Integrated Oil and Refining Earnings Calendar
                                           Earnings Release                    Conference Call
                             Ticker          Date       Time      Date      Time (ET)    Number            Access #
                              COP          October 26   BMO    October 26    8:00 AM       888-771-4371   30850169
                              HES          October 26   BMO    October 26    10:00 AM      866-383-8108   64467422
                              OXY          October 27   BMO    October 27    11:30 AM      800-473-6123      TBD
                              XOM          October 27   BMO    October 27    11:00 AM      913-312-9330    2672405
                              CVX          October 28   BMO    October 28    11:00 AM      703-871-3844    1552897
                              MUR         November 2    AMC    November 3    1:00 PM       888-300-2343    8833484


                              VLO         November 1    BMO    November 1    11:00 AM 210-345-2198           TBD
                              MPC         November 1    BMO    November 1       TBD                TBD       TBD
                              HFC         November 8    BMO    November 8    10:00 AM              TBD       TBD
                              SUN         November 3    AMC    November 3    4:30 PM       888-390-0918    8748773
                              TSO         November 2    AMC    November 3    8:30 AM           TBD          TBD
                              WNR         November 3    BMO    November 3    10:00 AM      866-566-8590   92274036
                               DK         November 3    BMO    November 3    11:00 AM      800-374-0131   17840856
                              ALJ         November 2    BMO    November 2      TBD             TBD          TBD
Source: Company data, Morgan Stanley Research




                                                                                                                      3
                                                                                 MORGAN             STANLEY             RESEARCH

                                                                                 October 14, 2011
                                                                                 Refining & Marketing




Consensus EPS Revisions and Short Interest
Exhibit 4                                                                        Exhibit 6
2011 Consensus EPS Revisions (Past 3 Months)                                     2012 Consensus EPS Revisions (Past 3 Months)

                                                             DK, 93.3%                                                                             DK, 125.8%



                                                TSO, 47.3%                                                              TSO, 35.7%



                                             ALJ, 42.8%                                                            HFC, 24.6%


                                             HFC, 41.1%                                                         MPC, 22.7%


                                           MPC, 30.5%                                                        VLO, 12.3%


                                      VLO, 12.9%                                                            WNR, 10.6%


                                     WNR, 9.3%
                                                                                                            ALJ, 8.7%


 SUN, -70.4%
                                                                                  SUN, -16.8%

 -100%          -50%            0%          50%           100%           150%
                                                                                  -40%       -20%   0%       20%     40%     60%     80%   100%   120%   140%
Source: FactSet, Morgan Stanley Research
                                                                                 Source: FactSet, Morgan Stanley Research

Exhibit 5
                                                                                 Exhibit 7
2011 Consensus EPS Revisions (Past 1 Month)
                                                                                 Short Interest as a % Shares Outstanding
                                                                     DK, 26.0%
                                                                                                                                                   WNR, 17.2%


                                                   SUN, 19.1%
                                                                                                                                  TSO, 11.0%


                                   TSO, 11.8%                                                                           SUN, 8.3%


                            VLO, 9.7%                                                               HFC, 3.5%


                          HFC, 8.6%                                                                 DK, 3.4%


                       WNR, 7.2%                                                                VLO, 2.5%



                       ALJ, 7.1%                                                                ALJ, 2.4%



                MPC, 5.0%                                                                    MPC, 1.3%


  0%          5%          10%         15%          20%         25%        30%      0%                 5%                    10%            15%             20%

Source: FactSet, Morgan Stanley Research                                         Source: FactSet, Morgan Stanley Research




                                                                                                                                                                4
                                                                                                    MORGAN             STANLEY            RESEARCH

                                                                                                    October 14, 2011
                                                                                                    Refining & Marketing




Morgan Stanley and Consensus Estimates
Exhibit 8
Morgan Stanley EPS Estimates Versus Consensus
                                           1QA           2QA            3QE           4QE                     Annual Estimate                      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          0.30          0.54           0.46                 (2.41)         1.57           2.97         NA         90%
          FS Consensus                      0.31          0.30          0.49           0.31                 (2.41)         1.47           2.10         NA         42%
          MS vs. Consensus                                              10%            52%                                  6%            41%
         DK                                 0.31          0.80          1.61           0.77                 (0.36)         3.52           3.58         NA          2%
          FS Consensus                      0.31          0.80          1.34           0.46                 (0.36)         3.21           2.78         NA        -13%
          MS vs. Consensus                                              20%            66%                                 10%            29%
         MPC                                1.48          2.29          2.57           1.47                  1.77          7.80           6.59       342%        -16%
          FS Consensus                      1.48          2.29          2.41           1.63                  1.77          7.85           6.62       345%        -16%
          MS vs. Consensus                                               6%           -10%                                  -1%            0%
         HFC                                0.79          1.79          2.40           1.45                  0.97          6.82           6.30         NA         -8%
          FS Consensus                      0.79          1.79          2.25           1.56                  0.97          6.51           5.17         NA        -21%
          MS vs. Consensus                                               7%             -7%                                 5%            22%
         SUN                               (1.01)         0.40          0.54           0.47                  1.79          0.68           1.70        -62%       152%
          FS Consensus                     (1.01)         0.40          0.59           0.28                  1.79          0.21           2.01        -88%         NA
          MS vs. Consensus                                               -8%           72%                                216%           -15%
         TSO                                0.74          1.65          2.03           0.70                 (0.27)         5.14           3.60         NA        -30%
          FS Consensus                      0.74          1.65          1.68           0.77                 (0.27)         5.02           3.99         NA        -21%
          MS vs. Consensus                                              21%             -9%                                 2%           -10%
         VLO                                0.18          1.30          1.93           0.85                  1.62          4.89           4.64       202%         -5%
          FS Consensus                      0.18          1.30          1.71           0.96                  1.62          4.32           4.29       166%         -1%
          MS vs. Consensus                                              13%           -11%                                 13%             8%

         WNR                                0.17          0.94          1.52           1.06                 (0.11)         3.70           5.14         NA         39%
          FS Consensus                      0.17          0.94          1.19           0.77                 (0.11)         3.36           3.49         NA          4%
          MS vs. Consensus                                              28%            37%                                 10%            47%
         Integrated Oil
         CVX                                3.09          3.85          3.32           3.07                  9.39         13.34          11.60         42%       -13%
           FS Consensus                     3.09          3.85          3.42           3.15                  9.39         13.47          12.80         43%        -5%
           MS vs. Consensus                                              -3%            -3%                                 -1%            -9%
         COP                                1.82          2.41          2.22           2.12                  5.92          8.57           8.18         45%        -5%
          FS Consensus                      1.82          2.41          2.17           1.96                  5.92          8.24           8.17         39%        -1%
          MS vs. Consensus                                               2%             8%                                  4%             0%
         XOM                                2.14          2.17          2.13           2.06                  6.22          8.51           7.93         37%        -7%
          FS Consensus                      2.14          2.18          2.13           2.14                  6.22          8.50           8.46         37%        -1%
          MS vs. Consensus                                               0%             -4%                                 0%             -6%
         HES                                1.83          1.56           1.25          1.51                  5.14          7.32           6.92         42%        -6%
          FS Consensus                      1.83          1.78           1.44          1.63                  5.14          6.65           7.19         29%         8%
          MS vs. Consensus                                              -13%            -7%                                10%             -4%
         MRO                                1.65          0.96          0.86           0.77                  3.65          3.73           3.86          2%         3%
          FS Consensus                      1.65          0.96          0.83           0.78                  3.65          3.88           3.65          6%        -6%
          MS vs. Consensus                                               4%             -1%                                 -4%            6%
         MUR                                1.38          1.60          1.20           1.12                  4.13          5.29           5.48         28%         3%
          FS Consensus                      1.38          1.60          1.17           1.32                  4.13          5.47           6.09         32%        11%
          MS vs. Consensus                                               2%           -15%                                  -3%          -10%
         OXY                                1.96          2.33          2.04           1.98                  5.72          7.99           8.54         40%         7%
          FS Consensus                      1.96          2.23          1.97           1.87                  5.72          8.01           8.39         40%         5%
          MS vs. Consensus                                               3%             6%                                  0%             2%
Source: FactSet, Morgan Stanley Research estimates; WNR estimates based on basic share count (not including dilutive convertible bond)




                                                                                                                                                                         5
                                                                                           MORGAN          STANLEY            RESEARCH

                                                                                           October 14, 2011
                                                                                           Refining & Marketing




Comparative Performance Table
Exhibit 9
Global Refining – Equity Performance
                          FDS               10/13/2011   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       1,203.66 1,370.58 1,074.77    (12.2%)   12.0%      3.3%      2.6%     (8.7%)    (8.4%)     2.2%     (4.3%)    12.8%     23.5%
  Energy                 SPN01      USD         480.97   598.02   428.25    (19.6%)   12.3%      3.7%     (0.4%)   (14.2%)   (14.8%)     8.9%     (5.1%)    17.9%     11.3%
  Oil Services             OIH      USD         116.31   167.37    95.00    (30.5%)   22.4%      4.5%     (8.7%)   (23.1%)   (25.0%)    (2.6%)   (17.2%)    18.2%     61.2%
  Integrated Oil         SPN25      USD         475.65   561.29   415.71    (15.3%)   14.4%      3.4%      4.0%     (9.5%)    (9.9%)    13.6%      1.4%     15.4%     (4.0%)
  US Refining            SPN35      USD         472.12   599.87   354.69    (21.3%)   33.1%      6.3%     (0.8%)   (10.5%)   (14.9%)    28.5%      5.5%     42.5%    (17.8%)

Commodities
 Crude Oil (WTI)      CL00-NYME     USD         85.57    114.00    75.67    (24.9%)    13.1%     3.6%     (5.1%)   (12.7%)   (20.1%)     3.1%     (6.4%)    15.1%     77.9%
 Crude Oil (Brent)    BRN00-IEPA    USD        108.97    126.66    80.75    (14.0%)    34.9%     3.1%     (0.7%)    (7.5%)   (10.9%)    28.4%     15.0%     21.6%     70.9%
 Natural Gas (HH)     NG00-NYME     USD          3.49      4.92     3.43    (29.1%)     1.7%    (3.0%)   (12.3%)   (20.5%)   (15.7%)    (5.6%)   (21.1%)   (20.1%)    (2.2%)
 Gulf Coast 3:2:1 (WTI)             USD         32.38     35.15     5.15     (7.9%)   528.4%    10.6%     (3.8%)    20.1%     54.0%    304.5%    243.6%     85.7%    (35.8%)
 Northeast 2:1:1 (Brent)            USD         11.61     16.33     6.40    (28.9%)    81.4%   (60.8%)   (66.0%)   (55.2%)   (38.9%)    53.1%     85.7%     96.9%    (68.6%)
 West Coast 3:2:1 (ANS)             USD         18.67     25.99     6.69    (28.2%)   179.2%   112.9%     25.9%     40.7%    (13.4%)    23.5%     56.0%      3.8%    (59.2%)
 Mid-Continent 3:2:1 (WTI)          USD         34.50     41.27     6.60    (16.4%)   423.0%     5.6%    (12.7%)    13.5%     44.2%    218.7%    220.9%    109.6%    (55.2%)

US Refiners
 Alon USA Energy          ALJ       USD          7.54     15.58     5.16    (51.6%)    46.1%     9.6%     (6.3%)   (35.0%)   (43.9%)    43.1%     26.1%    (12.6%)   (25.2%)
 Delek US Holding          DK       USD         14.53     17.50     6.65    (17.0%)   118.5%    12.5%      7.5%    (10.8%)     5.3%     99.6%     99.6%      6.9%     28.7%
 Marathon Petroleum       MPC       USD         33.77     47.43    26.35    (28.8%)    28.2%     1.4%     (4.4%)   (15.5%)       NM        NM    (13.4%)       NM        NM
 Holly Frontier Corp      HFC       USD         32.04     38.90    14.97    (17.6%)   114.0%     7.4%     (2.4%)   (10.3%)     4.2%     97.6%     57.2%     59.1%     40.6%
 Sunoco                   SUN       USD         34.47     46.98    27.36    (26.6%)    26.0%     3.6%     (7.6%)   (16.0%)   (19.9%)   (13.5%)   (14.5%)    54.4%    (39.9%)
 Tesoro                   TSO       USD         25.00     28.74    12.79    (13.0%)    95.5%     8.3%      6.5%      6.1%     (4.8%)    74.0%     34.8%     36.8%      2.9%
 Western Refining         WNR       USD         16.48     21.75     5.55    (24.2%)   196.9%    13.5%      4.2%    (16.9%)    (8.0%)   153.1%     55.8%    124.6%    (39.3%)
 Valero Energy            VLO       USD         22.65     31.12    16.40    (27.2%)    38.1%    11.6%      2.5%    (11.2%)   (19.1%)    24.0%     (2.0%)    38.0%    (22.6%)
 CVR Energy               CVI       USD         25.48     29.61     8.61    (13.9%)   195.9%    11.0%     (1.4%)    (1.9%)    14.1%    164.6%     67.9%    121.3%     71.5%

Europe Refiners
 Petroplus Holdings    PPHN-CH      CHF          5.33     17.87     4.50    (70.2%)   18.4%      5.5%    (7.1%)    (52.8%)   (60.5%)   (58.0%)   (56.7%)   (35.3%)   (1.6%)
 Saras                   SRS-IT     EUR          1.11      2.09     0.95    (46.8%)   16.8%      7.0%     0.5%     (19.6%)   (36.9%)   (26.9%)   (29.5%)   (28.0%)   (8.9%)
 Neste                 NES1V-FI     EUR          7.32     14.74     6.14    (50.4%)   19.1%      8.1%     3.0%     (29.0%)   (47.3%)   (38.1%)   (38.8%)    (3.8%)   17.4%
 ERG                     ERG-IT     EUR          8.82     10.74     7.60    (17.9%)   16.0%      1.6%     9.2%      (1.5%)   (10.9%)   (12.4%)   (15.6%)     8.0%    13.7%
 Galp                   GALP-PT     EUR         14.43     16.97    11.60    (15.0%)   24.4%      2.4%     5.3%      (7.2%)    (5.9%)     6.9%      0.6%     18.7%    68.2%
 OMV                    OMV-AT      EUR         24.50     34.76    20.81    (29.5%)   17.7%      3.4%    (0.5%)    (17.7%)   (22.8%)   (14.9%)   (20.7%)     1.3%    64.0%
 MOL                    MOL-HU      HUF        16,900    25,715   13,760    (34.3%)   22.8%      4.9%    15.3%     (21.2%)   (31.0%)   (18.9%)   (18.7%)    22.3%    72.2%
 Tupras                TUPRS-TR      TL         38.60     53.50    28.70    (27.9%)   34.5%      4.3%    13.2%      (7.4%)   (16.5%)    (1.0%)     0.0%     29.7%    83.6%
 PKN Orlen              PKN-PL      PLN         38.00     58.85    30.33    (35.4%)   25.3%      7.4%     5.8%     (24.0%)   (33.9%)    (7.1%)   (17.0%)    34.9%    31.9%

Asia Refiners
 Reliance Industries   500325-IN INR           846.85 1,187.00    713.55   (28.7%)    18.7%     10.4%     4.4%      (2.0%)   (17.1%)   (21.0%)   (20.0%)    (2.9%)    77.1%
 S-oil                 010950-KR KRW          102,000 170,000     66,100   (40.0%)    54.3%     12.1%    (8.9%)    (32.5%)   (31.1%)    45.5%     10.3%     71.3%    (12.2%)
 Showa Shell            5002-JP  JPY              591      912       520   (35.2%)    13.7%     10.5%     4.4%     (23.3%)   (30.6%)    (9.9%)   (20.6%)    (1.6%)   (13.7%)
 HPCL                  500104-IN INR           349.50   523.25    307.00   (33.2%)    13.8%     (5.9%)   (3.5%)    (13.1%)    (3.1%)   (32.5%)   (10.7%)     0.2%     43.3%
 Caltex                 CTX-AU   AUD            12.81    16.44      8.76   (22.1%)    46.2%      4.9%    17.0%      13.3%    (13.3%)     9.5%    (10.9%)    54.5%     29.3%
 Esso                  ESSO-TH THB               9.30    14.00      6.35   (33.6%)    46.5%      3.3%    (7.9%)    (17.7%)   (11.4%)    37.8%     17.0%     25.2%     18.7%
Source: FactSet, Morgan Stanley Research




                                                                                                                                                                         6
                                                                                       MORGAN                                         STANLEY                                         RESEARCH

                                                                                       October 14, 2011
                                                                                       Refining & Marketing




WTI Versus Waterborne Crude Oil Prices
We believe wider differentials at Cushing are secular,                                 Exhibit 11

rather than a seasonal anomaly. While we expect that                                   WTI Differential to Waterborne Crude Oil ($/bbl)
current record spreads above $26/bbl will abate, we believe                             $10                                                                                                WTI - Brent                  WTI - LLS

                                                                                          $5
secular pressures will drive WTI-Brent differentials to average
                                                                                          $0
$15+/bbl through 2Q13, versus historical parity. We believe                              ($5)

growing production volumes moving through Cushing,                                      ($10)

Oklahoma from Canada and US Lower 48 unconventional oil                                 ($15)

                                                                                        ($20)
resource will exceed takeaway capacity into 2013 and
                                                                                        ($25)
pressure pricing at Cushing. Additional refining capacity,                              ($30)
higher refining utilization, reversal of pipelines, new storage                         ($35)




                                                                                                  Oct-08



                                                                                                                    Jan-09




                                                                                                                                                        Jul-09



                                                                                                                                                                       Oct-09



                                                                                                                                                                                         Jan-10




                                                                                                                                                                                                                   Jul-10
                                                                                                                                      Apr-09




                                                                                                                                                                                                       Apr-10




                                                                                                                                                                                                                                  Oct-10



                                                                                                                                                                                                                                                  Jan-11




                                                                                                                                                                                                                                                                             Jul-11
                                                                                                                                                                                                                                                               Apr-11
capacity at Cushing and, eventually, new pipeline capacity to
the Gulf will not balance the market until 2013, and we see a
                                                                                       Source: Bloomberg, Morgan Stanley Research
likely scenario where crude production exceeds all storage at
Cushing, causing producers to compete on price until                                   Exhibit 12
production is shut-in, driving our bull case $50/bbl differential.                     Front Month WTI and WTI Time spreads ($/bbl)
                                                                                            $120
Exhibit 10
Mid-Con Crude Oil Prices ($/bbl)                                                            $100


                                                                                                 $80


                                                                                                 $60
                                                Clearbrook
                                                                                                 $40


                                                                                                 $20
                                      Bakken 86.98
                                                                                                  $0
                            WCS 74.23
                                                                                                           Oct-08



                                                                                                                             Jan-09



                                                                                                                                               Apr-09



                                                                                                                                                             Jul-09



                                                                                                                                                                           Oct-09



                                                                                                                                                                                           Jan-10



                                                                                                                                                                                                        Apr-10



                                                                                                                                                                                                                   Jul-10



                                                                                                                                                                                                                                 Oct-10



                                                                                                                                                                                                                                                Jan-11



                                                                                                                                                                                                                                                           Apr-11



                                                                                                                                                                                                                                                                        Jul-11
                            Hardisty, Canada
                                                       WTI 86.07             Chicago             $2                                                                                                                          First Month less Second Month

                                                                                                 $0

                                                                                                 ($2)
                                                      Brent 112.55                               ($4)

                                                                                                 ($6)
                                                                                                           Oct-08



                                                                                                                             Jan-09



                                                                                                                                               Apr-09



                                                                                                                                                             Jul-09



                                                                                                                                                                           Oct-09



                                                                                                                                                                                           Jan-10



                                                                                                                                                                                                        Apr-10



                                                                                                                                                                                                                   Jul-10



                                                                                                                                                                                                                                 Oct-10



                                                                                                                                                                                                                                                Jan-11



                                                                                                                                                                                                                                                           Apr-11



                                                                                                                                                                                                                                                                         Jul-11
                                                                   Patoka
                                                                                       Source: Bloomberg, Morgan Stanley Research
                                     WTI 84.23
                                                                                       Exhibit 13

                                                Cushing
                                                                                       Forward WTI/Brent Prices ($/bbl)
                                                                                                                                                          Oct-13                    Last Week                    Last Month                    Last Year
                                                                                                 30


                                                                                                 25
                                                 Eugene Island 111.53
         WTI 83.76                                                                               20
                                                                                         $/bbl




                                       Poseidon 108.98                  LLS 113.23               15
                Midland
                                                                                                 10
          WTS 83.53
                                                                         St. James                 5
                                     Beaumont             Houna              Empire
                          Maya 99.14                              Clovelly                         0
                                                  Mars 109.23
                          Mexico, LatAm                                                                     0                5         10               15            20            25              30    35                40            45        50       55         60            65
                                                                                                                                                                                                     Months
                                                                    HLS 113.13
                                                                                       Source: Bloomberg, Morgan Stanley Research
Source: Bloomberg, Morgan Stanley Research; prices as of Oct 13, 2011




                                                                                                                                                                                                                                                                                       7
                                                                                     MORGAN         STANLEY            RESEARCH

                                                                                     October 14, 2011
                                                                                     Refining & Marketing




Weekly DOE Petroleum Status Report
Exhibit 14
Crude Oil and Refined Product Statistics, Week Ending Oct 7
                        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                  13.2    12.0          10.1%           PADD 1        1,219                    PADD 1         1,124        69.7              71.0
    PADD 2                  94.0    94.1          -0.1%           PADD 2        1,542                    PADD 2         3,305        89.6              93.8
    PADD 3                163.8    163.2           0.3%           PADD 3        4,868                    PADD 3         7,348        87.2              89.7
    PADD 4                  17.0    17.0           0.0%           PADD 4          308                    PADD 4           532        86.3              81.1
    PADD 5                  49.6    49.9          -0.6%           PADD 5        1,149                    PADD 5         2,232        76.8              84.9
    Total US              337.6    336.3           0.4%           Total US      9,086       5,878        Total US      14,541        84.2              87.7
    Cushing, OK             30.6    30.1           1.8%           Last Week     8,699       5,800        Last Week     15,104        87.7
    SPR                   696.0    696.0           0.0%           Last Year     8,129       5,528        Last Year     13,920        81.9

                                                              Crude and Refined Product Implied Demand (mbpd)
                         Total       Finished     Reform-                     Total       Total                         > 15 ppm                  Propane,
                       Refined        Motor        ulated     Conventional  Kerosene   Distillate   < 15 ppm            Distillate    Residual   Propylene,
                       Products      Gasoline     Gasoline     Gasoline      Jet Fuel     Fuel    Distillate Fuel          Fuel       Fuel Oil   Other Oils
    Total US            18,737        9,346        2,990         6,356        1,533      4,949        4,468                480           781       1,201
    vs. Last Week       -1.9%          0.5%        -1.9%         1.7%         1.9%       -0.6%         2.2%              -21.2%        -18.6%      17.3%
    vs. Last Month       0.4%          1.1%         2.0%         0.7%         0.8%       12.4%        11.1%               26.0%        -21.6%      19.7%
    vs. Last Year        2.2%          3.6%        -3.2%         7.1%         2.8%       10.7%         2.4%              340.4%         7.0%       11.1%
                                                                      Refined Product Production (mbpd)
                         Total        Total       Reform-                      Total      Total                         >15 ppm
                       Refined       Motor         ulated     Conventional  Kerosene    Distillate   <15 ppm            Distillate    Residual   Propane,
                       Products     Gasoline      Gasoline     Gasoline      Jet Fuel     Fuel     Distillate Fuel         Fuel       Fuel Oil   Propylene
    Total US            16,532       8,914         2,990         5,831        1,503      4,414         3,919               494           531       1,170
    vs. Last Week       -4.1%        -4.0%         -1.1%         -5.2%        -7.2%      -5.4%         -2.9%             -22.0%        -11.2%     10.4%
    vs. Last Month      -2.1%        -4.7%          1.8%         -6.8%         0.0%      -1.8%         -0.8%              -9.2%        18.3%       7.0%
    vs. Last Year        4.5%        2.1%          -3.7%         -2.9%        11.1%      3.9%           7.6%             -18.5%         13.9%     14.1%
                                                                         Refined Product Stocks (MMbbl)
                         Total        Total       Finished      Gasoline        Total       Total                       >15 ppm                   Propane,
                       Refined       Motor          Motor       Blending      Kerosene    Distillate   <15 ppm          Distillate    Residual   Propylene,
                       Products     Gasoline      Gasoline     Component       Jet Fuel     Fuel     Distillate Fuel       Fuel       Fuel Oil   Other Oils
    Total US            735.5        209.6           53.5        156.1           46.8      154.0         101.4             52.6          33.6      274.7
    vs. Last Week       -0.4%        -1.9%          -4.9%        -0.9%          0.8%       -1.9%         -5.2%            5.4%           0.0%       1.6%
    vs. Last Month      -0.2%        -0.6%          -4.5%         0.9%          6.9%       -2.8%         -4.7%            1.0%          -5.7%       1.3%
    vs. Last Year       -4.9%        -3.9%         -25.5%         6.7%          0.3%      -10.6%         -5.2%           -19.4%        -16.7%      -1.9%
                                                                         Refined Product Imports (mbpd)
                          Total      Total        Finished      Gasoline         Total     Total                        >500 ppm                  Propane,
                       Refined       Motor          Motor       Blending      Kerosene    Distillate   <15 ppm           Distillate   Residual   Propylene,
                       Products     Gasoline      Gasoline     Component       Jet Fuel     Fuel     Distillate Fuel       Fuel       Fuel Oil   Other Oils
    Total US             1,956       418             39           379             86        117             52              65           251       1,084
    vs. Last Week        -7.6%      -17.2%         -50.6%        -11.0%       1128.6%     -43.8%        -64.4%            4.8%         -24.6%       2.0%
    vs. Last Month       1.3%       -36.6%         -76.2%        -23.4%       2050.0%     -24.0%        -57.4%           103.1%         -1.6%      26.2%
    vs. Last Year       -15.7%      -41.0%         -50.6%        -39.7%         34.4%     -37.8%        -61.2%            38.3%        -30.9%       8.8%

                                                             Refined Product Exports (mbpd)*
                           Total Refined          Finished                              Residual        Propane,
                             Products             Gasoline    Distillate Fuel Jet Fuel    Fuel          Propylene       Other Oils
    Total US                  2,479                 336            881          78        431              91              662
    vs. Last Month             4.1%                -14.9%         18.3%        16.4%      8.0%           -13.3%           -1.2%
    vs. Last Year             15.0%                59.2%          14.7%        27.9%     10.8%            13.8%            2.3%

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




                                                                                                                                                               8
                                                                                                                    MORGAN              STANLEY                RESEARCH

                                                                                                                    October 14, 2011
                                                                                                                    Refining & Marketing




Weekly Crack Spread Performance
Exhibit 15
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.
                                               13-Oct-11 6-Oct-11 13-Oct-10                  4Q11     3Q11      4Q10            Average     Last Wk Last Yr. Hist. Avg   3Q11                  4Q10   Hist. Avg
   3-2-1 Refining Margins ($/bbl)
     US Gulf Coast (WTI)                            32.38          31.65          8.21        32.30        30.50        7.79       10.95           2%       294%        196%             6%     315%      195%
     US Gulf Coast (LLS)                             5.41           6.70          5.55         6.02         8.38        4.03        7.04         -19%        -3%        -23%           -28%      49%      -15%
     US Northeast (Brent)                           11.61          10.78         10.46        11.41        12.39        9.93       11.17           8%        11%          4%            -8%      15%        2%
     US West Coast (ANS)                            18.67          13.35         16.21        17.18        12.30       13.29       17.17          40%        15%          9%            40%      29%        0%
     US Mid-Continent (WTI)**                       34.50          34.68         11.08        34.66        34.69        9.51       14.11          -1%       211%        144%             0%     264%      146%
     Northwest Europe (Brent)                        8.53           7.50          9.25         8.10         9.82        7.72        9.52          14%        -8%        -10%           -18%       5%      -15%
     Singapore (Dubai)                              22.28          21.04         11.79        21.97        19.39       12.53       14.62           6%        89%         52%            13%      75%       50%
   Global Product Cracks ($/bbl)
     US Avg. Gasoline*                               18.28         17.08          9.72        18.07        18.35        6.97       10.80          7%         88%         69%            -2%     159%       67%
     US Avg. Diesel*                                 23.66         25.17         13.72        24.35        23.76       13.33       16.42         -6%         72%         44%             2%      83%       48%
     US Avg. Fuel Oil*                               (5.48)        (4.43)        (8.75)       (5.00)       (7.69)      (9.29)     (12.26)        24%        -37%        -55%           -35%     -46%      -59%
     NW Europe Gasoline (Brent)                       5.47          3.96          7.25         4.86         7.19        4.85        5.67         38%        -25%         -4%           -32%       0%      -14%
     NW Europe Diesel (Brent)                        19.18         19.51         14.60        19.38        16.56       13.91       16.58         -2%         31%         16%            17%      39%       17%
     NW Europe Gas Oil (Brent)                       11.24         11.46         10.97        11.28        11.87        9.14       13.61         -2%          2%        -17%            -5%      23%      -17%
     NW Europe Fuel Oil (Brent)                     (14.19)       (12.90)       (14.51)      (13.63)      (14.89)     (16.30)     (16.43)        10%         -2%        -14%            -8%     -16%      -17%
     Singapore Gasoline (Dubai)                      24.75         22.13         11.37        23.91        20.16       12.36       14.17         12%        118%         75%            19%      93%       69%
     Singapore Naptha (Dubai)                       (12.24)        (7.90)        (1.21)      (10.73)       (8.15)       0.87       (2.80)        55%         NM         337%            32%      NM       283%
     Singapore Fuel Oil (Dubai)                      (2.27)        (0.55)        (8.32)       (1.46)       (4.60)      (9.40)      (9.72)       312%        -73%        -77%           -68%     -84%      -85%
     Ethanol Blending Margin ($/gal)                  0.14          0.10         (0.02)        0.12         0.12        0.02        0.14         43%         NM           4%             4%     387%      -14%
   Crude Oil Differentials
     US-Europe (LLS/Brent)                           3.41           1.09          2.19         2.63         0.10        2.44        2.91        213%          56%        17%            NM         8%     -10%
     US Mid-Continental (LLS/WTI)                   27.40          25.65          3.44        26.78        22.97        4.21        5.12          7%          NM        435%            17%       NM      423%
     Sweet-Sour Spread (LLS/Mars)                    3.69           3.04          4.57         3.42         2.91        5.15        6.46         21%         -19%       -43%            18%      -34%     -47%
     Light-Heavy Spread (LLS/Maya)                  13.47          12.12         12.18        12.84        14.14       13.59       14.01         11%          11%        -4%            -9%       -6%      -8%
     Light-Canadian Spread (WTI/WCS)**              10.07          10.00         14.72         9.96        14.46       16.09       13.53          1%         -32%       -26%           -31%      -38%     -26%
     US-Asia Spread (LLS/Dubai)                      9.82           5.87          5.63         8.61         5.48        4.91        5.86         67%          75%        68%            57%       75%      47%
   Commodity Prices
     WTI ($/bbl)                                    84.28         79.02          82.36        82.06       89.51        85.16       79.82           7%          2%          6%           -8%      -4%        3%
     Brent ($/bbl)                                 108.27        103.58          83.61       106.21      112.38        86.93       82.03           5%         29%         32%           -5%      22%       29%
     Henry Hub Nautral Gas ($/Mcf)                   3.44          3.61           3.44         3.50        4.12         3.80        5.78          -5%          0%        -40%          -15%      -8%      -39%
   *Avg. product crack spread includes regional refined product benchmark and respective crude slate: Gulf Coast = LLS, Mid-Con = WTI, Midwest = WTI, Northeast = Brent, West Coast = ANS
   **Rolling 5-Year Average includes October 2006 Through Present; Light-Canadian spread includes Edmonton Lloyd before May 2008

Source: Bloomberg, Morgan Stanley Research


Exhibit 16
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%               -                    -              -             -       -
   HollyFrontier Corp               HFC                  94%              443                  -             59%                 23%             19%                    -              -             -       -
   Marathon Petroleum               MPC                  96%            1,142                  -             53%                 47%               -                    -              -             -       -
   Sunoco                           SUN                  10%              505               100%               -                   -               -                    -              -             -       -
   Tesoro                           TSO                 100%              665                  -             17%                   -               -                  68%              -             -     14%
   Valero Energy                    VLO                 100%            3,000                  -             10%                 71%               -                  10%             9%             -       -
   Western Refining                 WNR                 100%              154                  -               -                100%               -                    -              -             -       -
   CVR Energy                       CVI                   NA              115                  -            100%                   -               -                    -              -             -       -

  Integrated Oil Companies
    Chevron Corp           CVX                            8%            1,950                 4%                -                17%               2%                 29%             -         39%         9%
    ConocoPhillips         COP                           12%            2,437                17%              15%                33%               2%                 15%           14%          3%          -
    ExxonMobil             XOM                            9%            6,246                 8%               5%                24%                -                  2%           28%         27%         5%
    Hess Corp              HES                            7%              245                29%                -                  -                -                   -             -           -        71%
    Murphy Oil             MUR                           10%              125                  -                                                    -                   -          100%           -          -
Source: Company data, Morgan Stanley Research estimates




                                                                                                                                                                                                                  9
                                                                                                                                                                                             MORGAN                            STANLEY                                        RESEARCH

                                                                                                                                                                                             October 14, 2011
                                                                                                                                                                                             Refining & Marketing




Refining Sector: Investment Thesis
Industry View: Attractive: We believe the US refining                                                                                                                                        Exhibit 18

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, 99.6%
within the group as well as a crude feedstock benefit. We
believe SUN restructuring with upside event-driven catalysts                                                                                                                                                                                                                                  HFC, 57.2%
supported by $24/sh in cash. We prefer all refiners with
exposure to Mid-con pricing differentials. We expect the US                                                                                                                                                                                                                                WNR, 55.8%
unconventional oil boom (centered in Mid-Con) and Canadian
growth will create storage issues at Cushing, OK until new                                                                                                                                                                                                                    Refining,
pipeline capacity is constructed mid-2013. Refiners exposed to                                                                                                                                                                                                                 36.7%

WTI, WTI-linked crude or Canadian heavy-light differentials will
                                                                                                                                                                                                                                                                              TSO, 34.8%
benefit significantly. We expect differentials to average
$15+/bbl through mid-2013 where we believe crude oil
production is likely to exceed all takeaway capacity and storage                                                                                                                                                                                                       ALJ, 26.1%

at Cushing, OK, leading to shut-in production and our $50/bbl
bull case.                                                                                                                                                                                                        VLO, -2.0%


Exhibit 17                                                                                                                                                                                                        S&P 500, -
Energy Sector and Market YTD Performance                                                                                                                                                                            4.3%

   40%                  36.7%                                                                                                                                                                                          Energy, -
                                                                                                                                                                                                                        5.1%
   30%
                                                                                                                                                                                                  MPC, -13.4%
   20%


                                                                                                                                                                                                  SUN, -14.5%
   10%


    0%                                                                                                                                                                                           -50%                                     0%                                   50%                                 100%                                     150%
                                                               -4.3%
  -10%
                                                                                              -8.9%                                                                                          Source: FactSet, Morgan Stanley Research, MPC YTD represents trading from when issue
                                                                                                                                                                                             date on June 23
                                                                                                                                -14.7%
  -20%                                                                                                                                                           -16.5%
                       Refining                           S&P 500                           Integrated                   Oil Services                             E&P

Source: FactSet, Note: Energy subsectors represent equal-weighted indices


Exhibit 19                                                                                                                                                                                   Exhibit 20
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

   0.0x                                                                                                                                                                                         $0
                                                                                                                                                                                                      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
          10/14/2004



                        05/12/2005



                                     12/08/2005



                                                  07/06/2006



                                                                  02/01/2007



                                                                               08/30/2007



                                                                                               03/27/2008



                                                                                                            10/23/2008



                                                                                                                          05/21/2009



                                                                                                                                       12/17/2009



                                                                                                                                                    07/15/2010



                                                                                                                                                                   02/10/2011



                                                                                                                                                                                09/08/2011




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




                                                                                                                                                                                                                                                                                                                                                                                10
                                                                                                     MORGAN                                 STANLEY                                          RESEARCH

                                                                                                     October 14, 2011
                                                                                                     Refining & Marketing




Investment Themes in Refining
1. Mid-Con Refining: Structural widening of           WTI-Brent spread to remain wide through mid-2013
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           $26                                                             Brent-WTI                               Average                                MS Forecast
                                                        $24
crude oils.                                             $22
                                                        $20
Thesis: Growing crude production from Canada            $18
                                                        $16
and Lower 48 unconventional resource will               $14
pressure storage constraints at Cushing,                $12
                                                        $10
Oklahoma, causing WTI to trade at a discount to          $8

Brent and waterborne crude oils. Less than 5% of         $6
                                                         $4
global refining capacity can process WTI-                $2
                                                         $0
advantaged crude oils, capturing the differential        ($2)
and directly increasing gross margins.                   ($4)
                                                         ($6)
                                                                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-11
Investment Ideas: HFC, WNR, MPC, DK
                                                      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 NAVs by selling or spinning off assets.   Company          Actions Taken                                                                                                                                     Started                    Performance*
Heightened interest mainly from National Oil                           Intent to sell $10B in assets. Sold Lukoil stake,
                                                      ConocoPhillips   Syncrude and CFJ Properties (marketing). Plans                                                                                                    Oct-09                               15%
Companies for upstream assets, institutional                           to spin off downstream assets
investor for midstream assets, and private equity                      Closures and sales of refineries and announced
                                                      Sunoco           divestiture of noncore assets (chemicals and                                                                                                      Jun-09                               -7%
for downstream assets have allowed companies
                                                                       logistics)
to offload noncore assets. The resulting                               New CEO institutes corporate strategy and plans
                                                      Tesoro                                                                                                                                                             May-10                               64%
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                                                                                                                                                          Jul-10                              -29%
                                                                       marketing assets
shareholders or pay down debt.                        Western Refining
                                                                       Shutdown of Yorktown refinery and evaluation of
                                                                                                                                                                                                                         Aug-10                               187%
                                                                       strategic alternatives
                                                      Marathon Oil     Spin off of downstream assets                                                                                                                     Jan-11                                4%
Investment Ideas: SUN, WNR, MPC                       Average Performance                                                                                                                                                                                     39%
                                                      *indicates performance versus subsector since date started
                                                      Source: Company data, Morgan Stanley Research


3. Distillation Utilization Steadily Increasing       Tightening Distillate Market Through 2013
Through 2013 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, MPC
                                                       86%


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

                                                      Source: IEA, Morgan Stanley Research estimates




                                                                                                                                                                                                                                                                     11
                                                                                          MORGAN          STANLEY            RESEARCH

                                                                                          October 14, 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,               Mid-Con crude production exceeds          Delek suggested it is still open to
(EW)   Arkansas refinery with exposure to advantaged Mid-Con crudes and                     all storage and takeaway capacity,        M&A, with a possible dilutive or
       sweet-sour differential. El Dorado refinery acquisition reduces risks                leading to shut-in production and         debt-heavy acquisition. Continued
       associated with a single refining asset. Largest relative retail exposure of         $50/bbl WTI differentials. Widening       poor margins in the Gulf Coast and
       the independent refiners provides greater earnings stability over time, but          of the sweet-sour spread.                 narrow sweet-sour spreads.
       lower upside leverage to refining margins.                                                                                     Parent buys in the public float.

 HFC   Strong advantages in both crude slates and niche markets (Rockies and                Mid-Con crude production exceeds          Pipeline reversals occur more
(OW)   Southwest) drive premium returns and multiple, with merger integration and           all storage and takeaway capacity,        quickly than expected, eliminating
       Tulsa refinery integration adds further benefit. Advantaged crude slate runs         leading to shut-in production and         WTI-linked vs. waterborne crude
       all WTI and WTI-linked crude slate (WTS, WCS, and Black Wax crude oils).             $50/bbl WTI differentials. Operating      differentials. Further project
       MLP Holly Energy Partners (HEP), 41% owned by HFC, and GP 100%                       efficiencies from merger and Tulsa        delays of UNEV pipeline, missing
       owned by HFC stable and growing IDR income, with possibility to drop down            integration. UNEV pipeline drives         winter month window of high
       further midstream assets following integration of Frontier midstream.                higher realized margin from Las           margin Las Vegas deliveries.
                                                                                            Vegas market.

MPC    Premium Mid-Continent refiner opportunity with 33% exposure (40% in YE               Mid-Con crude production exceeds          Pipeline reversals occur more
(OW)   2012) to structurally advantaged Mid-Con. Strong asset base/mix                      all storage and takeaway capacity,        quickly than expected, eliminating
       enhanced by Detroit upgrade coming online 4Q12. Continued downstream                 leading to shut-in production and         WTI-linked vs. waterborne crude
       restructuring, including MLP IPO, to drive valuation towards bull case.              $50/bbl WTI differentials. Possible       differentials. Detroit Heavy Oil
       Strong FCF with logistics and marketing growth opportunities. Strong Gulf            formation of a midstream MLP from         Upgrading Project is delayed with
       Coast presence at Garyville provides exposure to heavy light spreads and             MPC parent.                               startup beyond 2013.
       exports of product to LatAm and Europe.

SUN    SUN is inexpensive on its sum-of the parts valuation with upside                     Return of significant portion of excess   Delays in cash distribution
(OW)   event-driven catalysts. The implied valuation, pro-forma all our estimated           cash position to shareholders.            postpone value unlock. Northeast
       distribution, for remaining assets is 50% of public peers. SUN mostly                Potential JV, sale, shutdown,             refining continues to struggle from
       considered a NE refiner yet its 2012E exposure is less than 10% - below              liquidation of NE refining.               gasoline imports and operational
       most integrated oils - and ~85% is levered to growth businesses. SUN has             Monetization of undervalued GP units      issues cause further losses,
       diverged from its primary earnings drivers this year: met coal, logistics, and       in SXL.                                   eroding SUN equity value.
       retail.                                                                                                                        Company makes a dilutive
                                                                                                                                      acquisition with cash proceeds.

TSO    Primarily a West Coast refiner with five refineries in the region, which is          Economic improvement in California        West Coast recovery remains
(EW)   more structurally protected from refined product competition outside of the          drives higher West Coast crack            evasive with low crack spreads.
       region. Moderate exposure to Mid-Con differentials with 17% of operable              spreads. Further dropdowns into           Unable restructure Hawaii fuel oil
       capacity runs WTI-linked crude. Potential for further commodity agnostic             TLLP provide multiple uplift and cash.    contract. Punitive environmental
       benefits in 2011 as management team reduces costs, improves operations               Hawaii Public Utility Commission          regulations in California
       and attempts to restructure Hawaii fuel oil contract to bring back profitability     restructures fuel oil contracts.
       to the refinery.

VLO    Largest US Independent refiner, provides leverage to higher global crack             Wider crude differentials as loss of      Narrowing of heavy-light and
(EW)   spreads and refining. Complex refining system benefits from wider                    Libyan supply leads to wider              sweet-sour spreads as Libyan
       sweet-sour and heavy-light differentials with exposure to WTI discounts via          heavy-light and sweet-sour                supply comes back online. Latin
       Mid-Con refining (12% capacity) and Maya crude, which has linkages to                differentials. Stronger global refined    American demand improvements
       WTI prices. Gulf Coast refineries able to export diesel to secular demand            product demand, where VLO has             were temporal rather than secular.
       trends in Latin America. Strategic capex spend begins to positively impact           most exposure to growth of emerging       Overpays for future acquisition,
       earnings in 2H 2011, as project improvements are completed. Acquisition of           markets and export opportunities          diluting shareholders and
       Pembroke in UK will be accretive to earnings and adds geographic                                                               weakening existing asset base.
       diversification with ability to export distillate product to Europe.

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




                                                                                                                                                                           12
                                                                                         MORGAN                  STANLEY                RESEARCH

                                                                                         October 14, 2011
                                                                                         Refining & Marketing




Morgan Stanley Commodity Forecasts
Exhibit 21                                                                               Exhibit 23
Morgan Stanley Base Commodity Forecasts                                                  Crude Oil Forecast vs. Consensus (Brent)
  WTI Crude           Q1           Q2              Q3             Q4         Annual
                                                                                                                  Forward Curve                        MS Forecast                     Consensus
    2008            $97.82       $123.80         $118.22        $59.08       $99.73       $130
    2009            $43.31       $59.79          $68.24         $76.13       $61.87       $120
    2010            $78.88       $78.05          $76.21         $85.24       $79.60
                                                                                          $110
   2011E            $94.60       $102.34         $89.54         $87.00       $93.37
   2012E            $85.00       $83.00          $83.00         $83.00       $83.50       $100
                                                                                           $90
  Long-term         $86.00        $86.00         $86.00         $86.00       $86.00
                                                                                           $80
 Brent Crude          Q1           Q2              Q3           Q4           Annual
                                                                                           $70
     2008           $96.48       $122.20         $115.91      $56.23         $97.71
                                                                                                          2010A             2011E                2012E               2013E                2014E
     2009           $45.04       $59.28          $68.25       $74.93         $61.88
     2010           $76.78       $78.63          $76.41       $86.93         $79.69      Source: Bloomberg, Morgan Stanley Research estimates
    2011E           $105.21      $116.80         $112.38      $102.00        $109.10
    2012E           $100.00      $98.00          $98.00       $98.00         $98.50      Exhibit 24

  Long-term         $90.00        $90.00         $90.00         $90.00       $90.00      Brent Forward Prices ($/bbl)
Source: Bloomberg, Morgan Stanley Research estimates                                                               Oct-13         Last Week             Last Month         Last Year
                                                                                          120


                                                                                          110

Exhibit 22
                                                                                          100
2011 Crack Spread Forecast
                                 Q1A           Q2A         Q3A       Q4E       Annual      90
Blended Cracks
Gulf Coast 5-3-2 (LLS)         $5.37         $8.19      $8.91      $6.72        $7.30      80
Gulf Coast 3-2-1 (LLS)         $4.70         $7.89      $8.37      $6.50        $6.87
Gulf Coast 2-1-1 (LLS)         $6.37         $8.65      $9.72      $7.06        $7.95      70
Gulf Coast 5-3-2 (WTI)        $18.56        $24.02     $31.86     $21.72       $24.04           0     6     12    18   24    30        36   42    48      54    60    66        72   78        84   90
                                                                                                                                              Months
Gulf Coast 3-2-1 (WTI)        $17.90        $23.85     $31.32     $21.50       $23.64
Gulf Coast 2-1-1 (WTI)        $19.57        $24.27     $32.66     $22.06       $24.64    Source: Bloomberg, Morgan Stanley Research
NY 2-1-1 (Brent)               $9.06        $12.52     $11.66      $9.25       $10.62
Northeast 6-3-2-1 (Brent)      $7.78        $11.15     $10.25      $7.22        $9.10    Exhibit 25
West Coast 3-2-1 (ANS)        $17.50        $16.48     $11.98     $15.70       $15.42    Forward 3:2:1 Crack Spread ($/bbl)
West Coast 4-3-1 (ANS)        $17.06        $15.98     $11.51     $15.68       $15.06
Pacific NW 5-3-1-1 (ANS)      $15.36        $17.52     $14.56     $14.03       $15.37                             Oct-13          Last Week              Last Month             Last Year
                                                                                          14
Mid-Con 3-2-1 (WTI)           $19.08        $26.54     $33.97     $22.99       $25.64
Mid-Con 2-1-1 (WTI)           $20.59        $26.75     $35.04     $23.55       $26.48     12

Mid-Con 6-3-2-1 (WTI)         $15.28        $21.07     $30.14     $19.44       $21.48     10
Differentials
                                                                                           8
LLS less Maya                  $18.02        $14.90     $14.14     $23.50      $17.64
LLS less Mars                   $5.71         $6.17      $2.91      $5.00       $4.95      6
LLS less WTI                   $13.19        $15.69     $22.94     $15.00      $16.71      4
WTI less WTS                    $4.23         $2.56      $0.86      $3.00       $2.66
                                                                                           2
WTI less Lloyd WCS             $22.17        $17.62     $14.49     $15.00      $17.32
KERN River less ANS           ($11.43)      ($10.00)   ($10.00)   ($10.00)    ($10.36)     0
WTI less ANS                   ($7.04)      ($12.47)     $3.00      $3.00      ($3.38)          2          4           6           8             10            12          14             16             18
                                                                                                                                             Months
DURI less ANS                   $2.41        ($4.00)    ($4.00)    ($4.00)     ($2.40)
Tapis less ANS                  $8.29         $9.45      $5.00      $5.00       $6.94    Source: Company data, Morgan Stanley Research
ANS less Mars                  ($0.44)        $2.95      $1.00      $1.00       $1.13
ANS less Maya                  $11.87        $11.67      $8.00      $8.00       $9.88
Source: Morgan Stanley Research estimates




                                                                                                                                                                                                    13
                                                                                                                                            MORGAN                         STANLEY                              RESEARCH

                                                                                                                                            October 14, 2011
                                                                                                                                            Refining & Marketing




Global Economic & Leading Indicators
Exhibit 26
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%                                                                                                                           1.9%            1.8%
                                     2.8%                                                          2.9%                                   2.0%                                                                                               1.7%       1.7%
       3.0%
                                                 2.0%                                                              1.9%         2.0%      1.0%                                                                                                                    0.5%
       2.0%                                                                                                                                                                                                          0.4%
                                                                                                                                          0.0%
       1.0%
                                                                  0.0%                                                                    -1.0%
       0.0%
                                                                                                                                          -2.0%
    -1.0%
                                                                                                                                          -3.0%
    -2.0%                                                                                                                                 -4.0%
                                                                                                                                                                                                                                -4.1%
    -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%                                                                       9.0%
                10.1%     10.4%                                                                    10.3%
   10.0%                                                          9.6%
                                                                                   9.2%                             9.0%                                                                                             7.5%
                                                                                                                                 8.7%    8.0%                                                                                   7.2%                     7.3%       7.4%
                                                                                                                                                      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 estimates




Exhibit 27                                                                                                                                  Exhibit 28
ECRI Weekly Leading Index (1992=100)                                                                                                        US Industrial Production Index (2007=100)
 150                                                                                                                                         105



                                                                                                                                             100
 140


                                                                                                                                                 95
 130

                                                                                                                                                 90

 120
                                                                                                                                                 85


 110                                                                                                                                             80



                                                                                                                                                 75
 100
                                                                                                                                                      Nov-01



                                                                                                                                                                Nov-02



                                                                                                                                                                                Nov-03



                                                                                                                                                                                                Nov-04



                                                                                                                                                                                                            Nov-05



                                                                                                                                                                                                                       Nov-06



                                                                                                                                                                                                                                  Nov-07



                                                                                                                                                                                                                                               Nov-08



                                                                                                                                                                                                                                                         Nov-09



                                                                                                                                                                                                                                                                  Nov-10
       Oct-01



                 Oct-02



                          Oct-03



                                   Oct-04



                                             Oct-05



                                                         Oct-06



                                                                         Oct-07



                                                                                          Oct-08



                                                                                                          Oct-09



                                                                                                                       Oct-10




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




                                                                                                                                                                                                                                                                           14
                                                                               MORGAN                                  STANLEY                                       RESEARCH

                                                                               October 14, 2011
                                                                               Refining & Marketing




 Crude Oil Markets
Exhibit 29                                                                     Exhibit 30
Global Crude Oil Prices                                                        5-Year Brent Crude Oil Prices ($/bbl)
                                     This Week        Last Week    Last Year     $160

(US$/bbl)                             13-Oct-11         6-Oct-11   13-Oct-10                                                                                                                                         12-Month Strip                                 Front Month
                                                                                 $140
Global Benchmarks
  WTI Cushing                            $84.23          $82.59      $83.01      $120

  Dated Brent                           $112.16         $105.90      $84.39
                                                                                 $100
  Tapis                                 $120.91         $115.04      $90.73
  Bonny Light                           $112.44         $108.31      $85.67        $80

  Dubai Fateh                           $103.68          $98.82      $81.28        $60
Futures
  NYMEX front month                      $84.23          $82.59      $83.01        $40

  ICE Brent front month                 $111.18         $105.73      $84.64        $20
North Am Spot Crudes
  LLS St James                          $113.23         $108.34      $86.51         $0




                                                                                          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

                                                                                                                                                                                                                                                                               Jul-11
  Syncrude Sweet                         $92.98          $92.59      $82.31
  Alaska North Slope                    $108.88         $107.24      $83.26
  WTS Midland                            $83.53          $81.69      $80.41    Source: Bloomberg, Morgan Stanley Research
  Mars Blend                            $109.23         $105.34      $81.81
  Venezuela                              $96.30          $98.79      $74.52    Exhibit 31
  Maya                                   $99.14          $96.23      $74.18    North American Crude Differentials to WTI ($/bbl)
  Western Canadian Select                $74.23          $73.09      $68.51
                                                                                $35.00             +1 Standard Deviation                          -1 Standard Deviation                         Current Differential                          Trailing 2 Yr Avg
European Spot Crudes
  Oseberg                               $115.16         $108.90      $85.49     $30.00

  Brent                                 $113.16         $107.30      $85.07     $25.00
  Flotta                                $110.67         $104.83      $83.04
                                                                                $20.00
Middle East Spot Crudes
                                                                                $15.00
  Murbian                               $108.43         $103.43      $82.22
  Oman                                  $104.16          $99.40      $81.57     $10.00
  Arab Light                            $108.93         $105.02      $81.04       $5.00
  Arab Medium                           $106.58         $102.67      $79.49
                                                                                  $0.00
  Arab Heavy                            $104.28         $100.37      $78.09
African Spot Crudes                                                              ($5.00)

  Algeria Saharan                       $114.03         $109.16      $85.34     ($10.00)
  Nigeria Brass River                   $109.56         $105.18      $84.28                        Light LA Sweet Syncrude Sweet Alaska N Slope                                                                   WTS Midland                             Mars Blend
  Angola Cabinda                        $110.23         $105.67      $82.73
                                                                               Source: Bloomberg, Morgan Stanley Research
  Suez Blend                            $107.14         $101.77      $80.12
Asian Spot Crudes                                                              Exhibit 32
  Papua New Guinea                      $119.61         $113.74      $88.33    Global Crude Differentials to Brent ($/bbl)
  Australia Gippsland                   $117.41         $111.54      $87.53
  Indonesia Minas                       $120.94         $113.86      $86.93     $15.00                 +1 Standard Deviation                               -1 Standard Deviation                         Current Differential                            Trailing 2 Yr Avg

Global Refining Margins
  USGC (WTI)                                 $34.58      $33.44       $7.92     $10.00
  NWE (Brent)                                 $5.80       $6.70       $8.55
  Singapore (Tapis)                           $5.37       $5.94       $2.25
                                                                                 $5.00
  AG (Dubai)                                 $22.60      $22.16      $11.70
NYMEX Refining Margins
  NYMEX Front 321                            $34.58      $33.44       $7.92      $0.00
  NYMEX 321 Strip                            $30.07      $27.84       $9.61
  NYMEX CL HO                                $40.57      $37.58      $13.62
                                                                                 ($5.00)
  NYMEX HO CL 12 strip                       $35.38      $33.08      $12.78
  NYMEX CL XB                                $31.59      $30.22       $7.97
  NYMEX XB CL 12 strip                       $27.41      $25.22       $8.03     ($10.00)
                                                                                                             Tapis              Bonny Light                            Dubai                       Murbian                       Arab Light                         Arab Heavy
Source: Bloomberg, Morgan Stanley Research
                                                                               Source: Company data, Morgan Stanley Research




                                                                                                                                                                                                                                                                                        15
                                                                                                                                                                                                                                                               MORGAN                                                 STANLEY                                                                RESEARCH

                                                                                                                                                                                                                                                               October 14, 2011
                                                                                                                                                                                                                                                               Refining & Marketing




Commitment of Traders Report
Exhibit 33                                                                                                                                                                                                                                                     Exhibit 35
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)




                                                                                                                                                                                                                                                                        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-11
          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-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 34                                                                                                                                                                                                                                                     Exhibit 36
Natural Gas - CFTC Net Speculative Position                                                                                                                                                                                                                    RBOB - CFTC Net Speculative Position
 $16                                                           Nat Gas Net Long (Short)                                                      Front Month Nat Gas                                                                                                 $4.00                                                                            Net RBOB Long (Short)                                                                            Front Month RBOB                                                                                                100,000

                                                                                                                                                                                                                                                   250,000                                                                                                                                                                                                                                                                                                         90,000
 $14                                                                                                                                                                                                                                                             $3.50
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   80,000
                                                                                                                                                                                                                                                                 $3.00
 $12                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               70,000
                                                                                                                                                                                                                                                   150,000       $2.50
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   60,000
 $10
                                                                                                                                                                                                                                                                 $2.00                                                                                                                                                                                                                                                                                             50,000

                                                                                                                                                                                                                                                   50,000                                                                                                                                                                                                                                                                                                          40,000
  $8                                                                                                                                                                                                                                                             $1.50
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   30,000
                                                                                                                                                                                                                                                                 $1.00
  $6                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               20,000
                                                                                                                                                                                                                                                   (50,000)      $0.50
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   10,000
  $4
                                                                                                                                                                                                                                                                 $0.00                                                                                                                                                                                                                                                                                             0
                                                                                                                                                                                                                                                                                 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
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      Jul-11
  $2                                                                                                                                                                                                                                               (150,000)
       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-11




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




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       16
                                                                                                                                                                                                       MORGAN                                         STANLEY                                              RESEARCH

                                                                                                                                                                                                       October 14, 2011
                                                                                                                                                                                                       Refining & Marketing




Crude Fundamentals
Exhibit 37                                                                                                                                                                                             Exhibit 40
WTI vs. Brent ($/bbl)                                                                                                                                                                                  WTI & LLS vs. Maya ($/bbl)
                                                                                                                                                                                                         $30                                                                                             WTI vs. Maya                                          LLS vs. Maya

  $10                                                                                                                                                                                                    $25


   $5                                                                                                                                                                                                    $20

                                                                                                                                                                                                         $15
   $0
                                                                                                                                                                                                         $10
  ($5)
                                                                                                                                                                                                          $5
 ($10)
                                                                                                                                                                                                          $0
 ($15)
                                                                                                                                                                                                         ($5)
 ($20)
                                                                                                                                                                                                        ($10)
 ($25)
                                                                                                                                                                                                        ($15)




                                                                                                                                                                                                                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-11
 ($30)
           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-11




                                                                                                                                                                                                       Source: Bloomberg Morgan Stanley Research

Source: Bloomberg, Morgan Stanley Research
                                                                                                                                                                                                       Exhibit 41
Exhibit 38
                                                                                                                                                                                                       WTI & LLS vs. Canadian Oil Sands ($/bbl)
LLS vs. Brent ($/bbl)
                                                                                                                                                                                                        $50
 $12                                                                                                                                                                                                                                                                WTI vs. Canada Oil Sands                                                  LLS vs. Canada Oil Sands
                                                                                                                                                                                                        $45

 $10                                                                                                                                                                                                    $40

                                                                                                                                                                                                        $35
  $8
                                                                                                                                                                                                        $30

  $6                                                                                                                                                                                                    $25

                                                                                                                                                                                                        $20
  $4
                                                                                                                                                                                                        $15

  $2                                                                                                                                                                                                    $10

                                                                                                                                                                                                         $5
  $0
                                                                                                                                                                                                         $0
                                                                                                                                                                                                                             Jan-07




                                                                                                                                                                                                                                                                           Jan-08




                                                                                                                                                                                                                                                                                                                      Jan-09




                                                                                                                                                                                                                                                                                                                                                                     Jan-10




                                                                                                                                                                                                                                                                                                                                                                                                                                 Jan-11
                                                                                                                                                                                                                                         Apr-07

                                                                                                                                                                                                                                                     Jul-07




                                                                                                                                                                                                                                                                                      Apr-08

                                                                                                                                                                                                                                                                                                Jul-08




                                                                                                                                                                                                                                                                                                                                 Apr-09

                                                                                                                                                                                                                                                                                                                                            Jul-09




                                                                                                                                                                                                                                                                                                                                                                                   Apr-10

                                                                                                                                                                                                                                                                                                                                                                                                 Jul-10




                                                                                                                                                                                                                                                                                                                                                                                                                                                   Apr-11

                                                                                                                                                                                                                                                                                                                                                                                                                                                                 Jul-11
                                                                                                                                                                                                                Oct-06




                                                                                                                                                                                                                                                                Oct-07




                                                                                                                                                                                                                                                                                                            Oct-08




                                                                                                                                                                                                                                                                                                                                                        Oct-09




                                                                                                                                                                                                                                                                                                                                                                                                               Oct-10
  ($2)
                    Jan-07
                              Apr-07
                                        Jul-07


                                                            Jan-08
                                                                      Apr-08




                                                                                                           Apr-09




                                                                                                                                               Apr-10
         Oct-06




                                                  Oct-07




                                                                                Jul-08
                                                                                         Oct-08
                                                                                                  Jan-09


                                                                                                                    Jul-09
                                                                                                                             Oct-09
                                                                                                                                      Jan-10


                                                                                                                                                        Jul-10
                                                                                                                                                                 Oct-10
                                                                                                                                                                          Jan-11
                                                                                                                                                                                   Apr-11
                                                                                                                                                                                              Jul-11




                                                                                                                                                                                                       Prior to May 2008, WTI differential based on Edmonton Lloyd crude blend with Western
                                                                                                                                                                                                       Canadian Select blend used thereafter Source: Bloomberg, Morgan Stanley Research
Source: Bloomberg, Morgan Stanley Research

                                                                                                                                                                                                       Exhibit 42
Exhibit 39
ANS vs. Oriente ($/bbl)                                                                                                                                                                                WTI & LLS vs. Mars Sour Crude ($/bbl)
 $18                                                                                                                                                                                                     $15                                                                                      WTI vs. Mars                                        LLS vs. Mars

 $16
                                                                                                                                                                                                         $10
 $14
                                                                                                                                                                                                          $5
 $12
 $10                                                                                                                                                                                                      $0

  $8                                                                                                                                                                                                      ($5)
  $6
                                                                                                                                                                                                        ($10)
  $4
                                                                                                                                                                                                        ($15)
  $2
  $0                                                                                                                                                                                                    ($20)
  ($2)
                                                                                                                                                                                                        ($25)
                                                                                                                                                                                                                    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-11




  ($4)
         Oct-06
                    Jan-07
                              Apr-07
                                        Jul-07
                                                  Oct-07


                                                                      Apr-08
                                                                                Jul-08
                                                                                         Oct-08


                                                                                                           Apr-09
                                                                                                                    Jul-09
                                                                                                                             Oct-09
                                                            Jan-08




                                                                                                  Jan-09




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


                                                                                                                                                                                    Apr-11
                                                                                                                                                                                              Jul-11
                                                                                                                                                                          Jan-11




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




                                                                                                                                                                                                                                                                                                                                                                                                                                                                 17
                                                                                        MORGAN               STANLEY                RESEARCH

                                                                                        October 14, 2011
                                                                                        Refining & Marketing




US Product Crack Spreads
Exhibit 43                                                                              Exhibit 46
US Average 3:2:1 Crack Spread                                                           West Coast 3:2:1 (ANS)
  $40                                                                      5 Yr Max       $45                                                                     5 Yr Max
                                                                           5 Yr Min                                                                               5 Yr Min
  $35                                                                      5 Yr Avg
                                                                                          $40                                                                     5 Yr Avg
                                                                           2010                                                                                   2010
  $30
                                                                                          $35                                                                     2011
                                                                           2011

                                                                                          $30
  $25
                                                                                          $25
  $20
                                                                                          $20
  $15
                                                                                          $15
  $10
                                                                                          $10
   $5
                                                                                           $5

   $0                                                                                      $0
                     Mar




                                 May
                           Apr




                                                               Oct


                                                                     Nov
         Jan


               Feb




                                       Jun




                                                   Aug


                                                         Sep
                                             Jul




                                                                               Dec




                                                                                                                              May




                                                                                                                                                                  Nov
                                                                                                 Jan


                                                                                                       Feb

                                                                                                             Mar

                                                                                                                        Apr




                                                                                                                                    Jun




                                                                                                                                                Aug


                                                                                                                                                      Sep

                                                                                                                                                            Oct




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

Exhibit 44                                                                              Exhibit 47
Gulf Coast 3:2:1 (LLS)                                                                  Mid-Continent 3:2:1 (WTI)
  $40                                                                                     $45                5 Yr Max
                                                                             5 Yr Max
                                                                                                             5 Yr Min
                                                                             5 Yr Min
  $35                                                                                     $40                5 Yr Avg
                                                                             2011                            2010
  $30                                                                        2010         $35                2011
                                                                             5 Yr Avg
  $25                                                                                     $30

  $20                                                                                     $25

  $15                                                                                     $20

  $10                                                                                     $15

   $5                                                                                     $10

   $0                                                                                      $5

  ($5)                                                                                     $0
                                                                                                                              May




                                                                                                                                                                  Nov
                                                                                                                                          Jul
                                                                                                 Jan


                                                                                                       Feb




                                                                                                                                    Jun




                                                                                                                                                Aug


                                                                                                                                                      Sep


                                                                                                                                                            Oct




                                                                                                                                                                             Dec
                                                                                                             Mar


                                                                                                                        Apr
                                 May
               Feb

                     Mar


                           Apr




                                                                     Nov


                                                                               Dec
         Jan




                                       Jun


                                             Jul


                                                   Aug


                                                         Sep


                                                               Oct




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

Exhibit 45                                                                              Exhibit 48
Northeast 3:2:1 (Brent)                                                                 Midwest 3:2:1 (WTI)
  $35                                                                                     $45                                                                            5 Yr Max
                                                                             5 Yr Max
                                                                                                                                                                         5 Yr Min
                                                                             5 Yr Min     $40
  $30                                                                        5 Yr Avg                                                                                    2011
                                                                             2010         $35                                                                            2010

  $25                                                                        2011                                                                                        5 Yr Avg
                                                                                          $30

  $20                                                                                     $25

                                                                                          $20
  $15
                                                                                          $15

  $10                                                                                     $10

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




                                                                     Nov
                                             Jul
         Jan


               Feb




                                       Jun




                                                   Aug


                                                         Sep


                                                               Oct




                                                                               Dec
                     Mar


                           Apr




                                                                                                                              May
                                                                                                             Mar




                                                                                                                                                                  Nov
                                                                                                                        Apr
                                                                                                 Jan


                                                                                                       Feb




                                                                                                                                    Jun




                                                                                                                                                Aug


                                                                                                                                                      Sep


                                                                                                                                                            Oct
                                                                                                                                          Jul




                                                                                                                                                                             Dec




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




                                                                                                                                                                                   18
                                                                                             MORGAN                STANLEY           RESEARCH

                                                                                             October 14, 2011
                                                                                             Refining & Marketing




Gasoline Crack Spreads ($/bbl)
Exhibit 49                                                                                   Exhibit 52
US Average Gasoline Crack                                                                    Mid-Continent Gasoline Crack (WTI)
  $50                                                                                          $50                                                                         5 Yr Max
                                                                                 5 Yr Max                                                                                  5 Yr Min
                                                                                 5 Yr Min                                                                                  2011
  $40                                                                            2011          $40                                                                         2010
                                                                                 2010                                                                                      5 Yr Avg
                                                                                 5 Yr Avg
  $30                                                                                          $30



  $20                                                                                          $20


                                                                                               $10
  $10


                                                                                                $0
   $0


                                                                                              ($10)
  ($10)




                                                                                                                               May
                                                                                                       Jan


                                                                                                             Feb




                                                                                                                                     Jun




                                                                                                                                                             Oct
                                                                                                                                           Jul


                                                                                                                                                 Aug


                                                                                                                                                       Sep




                                                                                                                                                                   Nov
                                                                                                                   Mar


                                                                                                                         Apr




                                                                                                                                                                             Dec
                                      May




                                                                     Oct
                        Mar


                               Apr
          Jan


                 Feb




                                             Jun


                                                   Jul


                                                         Aug


                                                               Sep




                                                                           Nov


                                                                                    Dec




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


Exhibit 50                                                                                   Exhibit 53
Gulf Coast Gasoline Crack (LLS)                                                              West Coast Gasoline Crack (ANS)
  $40                                                                            5 Yr Max      $60                                                                        5 Yr Max

  $35                                                                            5 Yr Min                                                                                 5 Yr Min
                                                                                 2011
                                                                                               $50                                                                        2011
  $30                                                                                                                                                                     2010
                                                                                 2010
  $25                                                                            5 Yr Avg
                                                                                               $40                                                                        5 Yr Avg

  $20                                                                                          $30
  $15
                                                                                               $20
  $10

    $5                                                                                         $10

    $0
                                                                                                $0
   ($5)

  ($10)                                                                                        ($10)
                                                                                                                               May




                                                                                                                                           Jul




                                                                                                                                                                    Nov
                                                                                                       Jan


                                                                                                             Feb




                                                                                                                                     Jun




                                                                                                                                                 Aug


                                                                                                                                                       Sep


                                                                                                                                                             Oct




                                                                                                                                                                              Dec
                                                                                                                   Mar


                                                                                                                         Apr
                                       May
           Jan


                  Feb




                                             Jun


                                                   Jul




                                                                           Nov
                                                         Aug


                                                               Sep


                                                                     Oct
                         Mar


                                Apr




                                                                                     Dec




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

Exhibit 51                                                                                   Exhibit 54
Northeast Gasoline Crack (Brent)                                                             Midwest Gasoline Crack (WTI)
  $35                                                                                          $60
                                                                                  5 Yr Max                                                                                5 Yr Max
                                                                                  5 Yr Min                                                                                5 Yr Min
  $30                                                                             2011         $50                                                                        2011
                                                                                  2010                                                                                    2010
  $25                                                                             5 Yr Avg     $40                                                                        5 Yr Avg


  $20                                                                                          $30

  $15                                                                                          $20

  $10                                                                                          $10


   $5                                                                                           $0


   $0                                                                                          ($10)

                                                                                               ($20)
  ($5)
                                                                                                                               May




                                                                                                                                           Jul




                                                                                                                                                                    Nov
                                                                                                       Jan


                                                                                                             Feb




                                                                                                                                     Jun




                                                                                                                                                 Aug


                                                                                                                                                       Sep


                                                                                                                                                             Oct




                                                                                                                                                                              Dec
                                                                                                                   Mar


                                                                                                                         Apr
                                      May




                                                   Jul
          Jan


                 Feb




                                             Jun




                                                         Aug


                                                               Sep


                                                                     Oct


                                                                           Nov
                        Mar


                               Apr




                                                                                     Dec




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




                                                                                                                                                                                     19
                                                                                                                 MORGAN              STANLEY                   RESEARCH

                                                                                                                 October 14, 2011
                                                                                                                 Refining & Marketing




Diesel Crack Spreads ($/bbl)
Exhibit 55                                                                                                       Exhibit 58
US Average ULSD Crack                                                                                            Mid-Continent ULSD Crack (WTI)
  $40                     5 Yr Max            5 Yr Min             2010           2011          5 Yr Avg           $50
                                                                                                                                             5 Yr Max           5 Yr Min           5 Yr Avg           2010         2011
                                                                                                                   $45
  $35
                                                                                                                   $40
  $30
                                                                                                                   $35
  $25                                                                                                              $30

  $20                                                                                                              $25

                                                                                                                   $20
  $15
                                                                                                                   $15
  $10
                                                                                                                   $10

   $5                                                                                                               $5

                                                                                                                    $0
   $0




                                                                                                                                                        May




                                                                                                                                                                           Jul




                                                                                                                                                                                                             Nov
                                                                                                                         Jan


                                                                                                                               Feb




                                                                                                                                                                 Jun




                                                                                                                                                                                    Aug


                                                                                                                                                                                              Sep


                                                                                                                                                                                                       Oct




                                                                                                                                                                                                                          Dec
                                                                                                                                     Mar


                                                                                                                                              Apr
                                        May
                    Mar


                              Apr




                                                             Jul




                                                                                         Oct


                                                                                                 Nov


                                                                                                           Dec
        Jan


              Feb




                                                  Jun




                                                                      Aug


                                                                                Sep




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


Exhibit 56                                                                                                       Exhibit 59
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




                                                                                                                                                                 Jun




                                                                                                                                                                                    Aug


                                                                                                                                                                                              Sep


                                                                                                                                                                                                       Oct




                                                                                                                                                                                                                          Dec
                                                                                                                                     Mar


                                                                                                                                              Apr
                                        May




                                                             Jul




                                                                                                 Nov
        Jan


              Feb




                                                   Jun




                                                                      Aug


                                                                                Sep


                                                                                         Oct




                                                                                                           Dec
                    Mar


                              Apr




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


Exhibit 57                                                                                                       Exhibit 60
Northeast ULSD Crack (Brent)                                                                                     Midwest ULSD Crack (WTI)
  $45                                                                                                              $50
                                                                                                                                           5 Yr Max           5 Yr Min           5 Yr Avg           2010      2011
                             5 Yr Max             5 Yr Min           5 Yr Avg            2010          2011
                                                                                                                   $45
  $40
                                                                                                                   $40
  $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




                                                                                                 Nov
        Jan


              Feb


                    Mar


                              Apr




                                                   Jun




                                                                      Aug


                                                                                Sep


                                                                                          Oct




                                                                                                           Dec




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




                                                                                                                                                                                                                                20
                                                                                                                                                                                MORGAN                         STANLEY                                 RESEARCH

                                                                                                                                                                                October 14, 2011
                                                                                                                                                                                Refining & Marketing




Other US Product Crack Spreads
Exhibit 61                                                                                                                                                                      Exhibit 64
NY Harbor #2 Heating Oil (Brent)                                                                                                                                                NY Harbor 54-Grade Jet Fuel Crack (Brent)
  $35                               5 Yr Max                           5 Yr Min                         5 Yr Avg                       2010                    2011
                                                                                                                                                                                  $60
                                                                                                                                                                                                                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




                                                                               Jun




                                                                                                             Aug


                                                                                                                        Sep


                                                                                                                                          Oct




                                                                                                                                                                                           Jan


                                                                                                                                                                                                    Feb




                                                                                                                                                                                                                                                            Jun




                                                                                                                                                                                                                                                                                    Aug


                                                                                                                                                                                                                                                                                               Sep


                                                                                                                                                                                                                                                                                                                Oct
                                                                                                                                                                          Dec




                                                                                                                                                                                                                                                                                                                                                Dec
                                    Mar


                                                   Apr




                                                                                                                                                                                                               Mar


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


Exhibit 62                                                                                                                                                                      Exhibit 65
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




                                                                               Jun




                                                                                                             Aug


                                                                                                                        Sep


                                                                                                                                          Oct




                                                                                                                                                                                           Jan


                                                                                                                                                                                                    Feb




                                                                                                                                                                                                                                                            Jun




                                                                                                                                                                                                                                                                                    Aug


                                                                                                                                                                                                                                                                                               Sep


                                                                                                                                                                                                                                                                                                                Oct
                                                                                                                                                                          Dec




                                                                                                                                                                                                                                                                                                                                                Dec
                                    Mar


                                                   Apr




                                                                                                                                                                                                               Mar


                                                                                                                                                                                                                              Apr




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


Exhibit 63                                                                                                                                                                      Exhibit 66
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


  $1.00                                                                                                                                                                           $1.50


                                                                                                                                                                                  $1.00
  $0.00
                                                                                                                                                                                  $0.50


  ($1.00)                                                                                                                                                                         $0.00


                                                                                                                                                                                 ($0.50)
  ($2.00)
                                                                                                                                                                                           Oct-06




                                                                                                                                                                                                      Apr-07




                                                                                                                                                                                                                     Oct-07




                                                                                                                                                                                                                                     Apr-08




                                                                                                                                                                                                                                                        Oct-08




                                                                                                                                                                                                                                                                       Apr-09




                                                                                                                                                                                                                                                                                      Oct-09




                                                                                                                                                                                                                                                                                                     Apr-10




                                                                                                                                                                                                                                                                                                                      Oct-10




                                                                                                                                                                                                                                                                                                                                       Apr-11
                           Apr-07




                                                            Apr-08




                                                                                               Apr-09




                                                                                                                              Apr-10




                                                                                                                                                                 Apr-11
            Oct-06




                                          Oct-07




                                                                            Oct-08




                                                                                                               Oct-09




                                                                                                                                                Oct-10




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




                                                                                                                                                                                                                                                                                                                                                      21
                                                                                                                                        MORGAN               STANLEY                     RESEARCH

                                                                                                                                        October 14, 2011
                                                                                                                                        Refining & Marketing




Global Product Crack Spreads
Exhibit 67                                                                                                                              Exhibit 70
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
                                              ay
                                       r




                                                                                g


                                                                                            p
                         ar




                                                                       l




                                                                                                                ov


                                                                                                                        ec
     n


                  b




                                                           n




                                                                                                      ct
                                                                     Ju
                                    Ap
   Ja


                Fe




                                                         Ju




                                                                             Au


                                                                                         Se


                                                                                                  O
                        M




                                             M




                                                                                                               N


                                                                                                                       D




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


Exhibit 68                                                                                                                              Exhibit 71
Northwest Europe 95 RON Gasoline Crack (Brent)                                                                                          Singapore 97 Octane Gasoline Crack (Dubai)
  $35                                                                                                                                     $30                5 Yr Min              5 Yr Max                5 Yr Avg              2010            2011
                            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




                                                                                                             Oct


                                                                                                                     Nov
          Jan


                      Feb




                                                               Jun




                                                                                      Aug


                                                                                                Sep
                              Mar


                                           Apr




                                                                                                                              Dec




                                                                                                                                          ($5)
                                                                                                                                                                                   May




                                                                                                                                                                                                     Jul




                                                                                                                                                                                                                                           Nov
                                                                                                                                                 Jan


                                                                                                                                                       Feb


                                                                                                                                                               Mar


                                                                                                                                                                         Apr




                                                                                                                                                                                              Jun




                                                                                                                                                                                                                 Aug


                                                                                                                                                                                                                           Sep


                                                                                                                                                                                                                                    Oct




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

Exhibit 69
                                                                                                                                        Exhibit 72
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




                                                                                                                                                                                                     Jul




                                                                                                                                                                                                                                           Nov
                                                                                                                                                 Jan


                                                                                                                                                       Feb




                                                                                                                                                                                              Jun




                                                                                                                                                                                                                 Aug


                                                                                                                                                                                                                           Sep


                                                                                                                                                                                                                                    Oct




                                                                                                                                                                                                                                                        Dec
                                                                                                                                                               Mar


                                                                                                                                                                         Apr
                                                   May




                                                                            Jul
          Jan


                      Feb




                                                               Jun




                                                                                        Aug


                                                                                                 Sep


                                                                                                              Oct


                                                                                                                       Nov
                              Mar


                                           Apr




                                                                                                                                  Dec




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




                                                                                                                                                                                                                                                              22
                                                                                                         MORGAN                          STANLEY                      RESEARCH

                                                                                                         October 14, 2011
                                                                                                         Refining & Marketing




Refinery Crude Throughputs
Exhibit 73                                                                                               Exhibit 76
Total US Refiner Crude Throughputs (mbpd)                                                                PADD 3 (Gulf Coast) Crude Throughputs (mbpd)
  17,000                                                                                                   9,000
                         5 Yr Max          5 Yr Min          5 Yr Avg         2010          2011                                           5 Yr Max                5 Yr Min            5 Yr Avg            2010           2011


  16,000                                                                                                   8,000


  15,000                                                                                                   7,000


  14,000                                                                                                   6,000


  13,000                                                                                                   5,000


  12,000                                                                                                   4,000


  11,000                                                                                                   3,000




                                                                                                                                                              May
                                                                                                                                           Mar


                                                                                                                                                       Apr
                                                                                                                       Jan




                                                                                                                                                                                                             Oct
                                                                                                                               Feb




                                                                                                                                                                         Jun




                                                                                                                                                                                           Aug


                                                                                                                                                                                                    Sep




                                                                                                                                                                                                                    Nov
                                                                                                                                                                                 Jul




                                                                                                                                                                                                                             Dec
                                     May
                       Mar




                                                       Jul




                                                                                Oct
           Jan


                 Feb




                                                Jun




                                                                 Aug


                                                                        Sep
                               Apr




                                                                                      Nov


                                                                                                   Dec




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

                                                                                                         Exhibit 77
Exhibit 74
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
                               Apr




                                                                                      Nov
           Jan


                 Feb




                                                Jun




                                                                 Aug


                                                                        Sep


                                                                                Oct
                                                       Jul




                                                                                                   Dec




                                                                                                                                                             May
                                                                                                                                         Mar




                                                                                                                                                                                                                    Nov
                                                                                                                                                     Apr
                                                                                                                 Jan


                                                                                                                             Feb




                                                                                                                                                                        Jun




                                                                                                                                                                                           Aug


                                                                                                                                                                                                    Sep


                                                                                                                                                                                                             Oct




                                                                                                                                                                                                                                 Dec
                                                                                                                                                                                Jul




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

Exhibit 75                                                                                               Exhibit 78
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




                                                                                      Nov
           Jan


                 Feb

                       Mar


                               Apr




                                                       Jul
                                                 Jun




                                                                 Aug


                                                                        Sep


                                                                                Oct




                                                                                                   Dec




                                                                                                                                                               May
                                                                                                                                               Mar




                                                                                                                                                                                                                    Nov
                                                                                                                                                       Apr
                                                                                                                       Jan


                                                                                                                                   Feb




                                                                                                                                                                          Jun




                                                                                                                                                                                            Aug


                                                                                                                                                                                                     Sep


                                                                                                                                                                                                             Oct
                                                                                                                                                                                 Jul




                                                                                                                                                                                                                                 Dec




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




                                                                                                                                                                                                                                       23
                                                                                                                 MORGAN                      STANLEY                   RESEARCH

                                                                                                                 October 14, 2011
                                                                                                                 Refining & Marketing




Gasoline Fundamentals
Exhibit 79                                                                                                       Exhibit 81
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
                                                                                                                                                                           Jun


                                                                                                                                                                                   Jul
                                                                                                                               Jan




                                                                                                                                                                                             Aug


                                                                                                                                                                                                     Sep
                                                                                                                                                         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 80                                                                                                       Exhibit 82
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




                                                                                                                                                                                                                      Nov
                                                                                                                             Jan


                                                                                                                                     Feb




                                                                                                                                                        Apr




                                                                                                                                                                          Jun


                                                                                                                                                                                  Jul


                                                                                                                                                                                             Aug


                                                                                                                                                                                                     Sep


                                                                                                                                                                                                              Oct




                                                                                                                                                                                                                               Dec
                                            May
                    Feb

                           Mar


                                      Apr




                                                                                             Nov


                                                                                                     Dec
             Jan




                                                     Jun


                                                             Jul


                                                                     Aug


                                                                               Sep


                                                                                      Oct




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


Exhibit 83
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




                                                                                                                                                                                                                                     24
                                                                                                                                          MORGAN                              STANLEY                       RESEARCH

                                                                                                                                          October 14, 2011
                                                                                                                                          Refining & Marketing




Distillate Fundamentals
Exhibit 84                                                                                                                                Exhibit 86
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




                                                                                Jul
          Jan


                      Feb




                                                                      Jun




                                                                                           Aug


                                                                                                      Sep


                                                                                                              Oct




                                                                                                                              Dec




                                                                                                                                                                                                   May
                                                                                                                                                                                Mar


                                                                                                                                                                                           Apr




                                                                                                                                                                                                                                                              Nov
                                                                                                                                                          Jan


                                                                                                                                                                       Feb




                                                                                                                                                                                                               Jun


                                                                                                                                                                                                                          Jul


                                                                                                                                                                                                                                   Aug


                                                                                                                                                                                                                                               Sep


                                                                                                                                                                                                                                                      Oct




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

Exhibit 85                                                                                                                                Exhibit 87
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
                                        Mar




                                                                                  Jul




                                                                                                               Oct
                Jan


                            Feb




                                                     Apr




                                                                        Jun




                                                                                              Aug


                                                                                                       Sep




                                                                                                                      Nov


                                                                                                                               Dec




                                                                                                                                                                                                 May
                                                                                                                                                                              Mar




                                                                                                                                                                                                                         Jul




                                                                                                                                                                                                                                                     Oct
                                                                                                                                                    Jan


                                                                                                                                                                 Feb




                                                                                                                                                                                      Apr




                                                                                                                                                                                                             Jun




                                                                                                                                                                                                                                  Aug


                                                                                                                                                                                                                                              Sep




                                                                                                                                                                                                                                                             Nov


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



Exhibit 88
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




                                                                                                                                                                                                                                                                            25
                                                                                                                            MORGAN                               STANLEY                             RESEARCH

                                                                                                                            October 14, 2011
                                                                                                                            Refining & Marketing




Other Refined Product Market Fundamentals
Exhibit 89                                                                                                                  Exhibit 92
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

                                                                                                                            -10%
   70


   65
                                                                                                                            -15%
                                               May
                            Mar


                                       Apr




                                                                   Jul
        Jan


                    Feb




                                                          Jun




                                                                             Aug


                                                                                       Sep


                                                                                                Oct


                                                                                                        Nov


                                                                                                                     Dec




                                                                                                                               Sep-06         Mar-07             Sep-07      Mar-08            Sep-08          Mar-09         Sep-09       Mar-10            Sep-10           Mar-11            Sep-11


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


Exhibit 90                                                                                                                  Exhibit 93
Implied Jet-Kerosene Fuel Demand (mbpd)                                                                                     Total Crude Oil Stocks (ex-SPR, Mbbl)
  2,000                             5 Yr Max            5 Yr Min            5 Yr Avg            2010            2011          400,000
                                                                                                                                                                        5 Yr Max                     5 Yr Min                   5 Yr Avg                      2010                  2011


  1,800


                                                                                                                              350,000
  1,600



  1,400

                                                                                                                              300,000
  1,200



  1,000
                                                 May




                                                                                                        Nov
                              Mar


                                         Apr




                                                                                                 Oct




                                                                                                                      Dec
              Jan


                      Feb




                                                            Jun

                                                                    Jul


                                                                              Aug


                                                                                        Sep




                                                                                                                              250,000
                                                                                                                                                                                               May




                                                                                                                                                                                                                                                                              Nov
                                                                                                                                            Jan


                                                                                                                                                           Feb




                                                                                                                                                                                                              Jun


                                                                                                                                                                                                                        Jul


                                                                                                                                                                                                                                  Aug


                                                                                                                                                                                                                                              Sep


                                                                                                                                                                                                                                                              Oct




                                                                                                                                                                                                                                                                                          Dec
                                                                                                                                                                    Mar


                                                                                                                                                                              Apr




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

Exhibit 91                                                                                                                  Exhibit 94
US Propylene Stocks, non-fuel use (mbbl)                                                                                    US Vehicle Miles Traveled (YoY%)
  5,000                                                                                                                      3%                                                             YoY (Current Month)                  YoY (3 Month MA)
                                   5 Yr Max            5 Yr Min           5 Yr Avg            2010            2011
  4,500                                                                                                                      2%
  4,000
                                                                                                                             1%
  3,500
                                                                                                                             0%
  3,000
                                                                                                                             -1%
  2,500

  2,000                                                                                                                      -2%

  1,500                                                                                                                      -3%

  1,000
                                                                                                                             -4%
   500
                                                                                                                             -5%
        0
                                                                                                                                                  May-07




                                                                                                                                                                                   May-08




                                                                                                                                                                                                                    May-09




                                                                                                                                                                                                                                                    May-10




                                                                                                                                                                                                                                                                                       May-11
                                                                                                                                   Nov-06




                                                                                                                                                                    Nov-07




                                                                                                                                                                                                     Nov-08




                                                                                                                                                                                                                                  Nov-09




                                                                                                                                                                                                                                                                     Nov-10
                                                May




                                                                                                       Nov
                                                                   Jul
            Jan


                      Feb




                                                           Jun




                                                                             Aug


                                                                                       Sep
                             Mar


                                        Apr




                                                                                                Oct




                                                                                                                    Dec




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




                                                                                                                                                                                                                                                                                                 26
                                                                                                                                                       MORGAN                   STANLEY                              RESEARCH

                                                                                                                                                       October 14, 2011
                                                                                                                                                       Refining & Marketing




US Refined Product Stocks
Exhibit 95                                                                                                                                             Exhibit 98
Total US Refined Product Stocks (MMbbl)                                                                                                                Total PADD 3 (Gulf Coast) Product Stocks (MMbbl)
                                                                                                                                                         210,000
  800                           5 Yr Max                    5 Yr Min                      5 Yr Avg                     2010               2011                                                5 Yr Max                   5 Yr Min                 5 Yr Avg                       2010                  2011
                                                                                                                                                         200,000

                                                                                                                                                         190,000
  750
                                                                                                                                                         180,000

                                                                                                                                                         170,000
  700
                                                                                                                                                         160,000

                                                                                                                                                         150,000
  650
                                                                                                                                                         140,000

                                                                                                                                                         130,000




                                                                                                                                                                                                                   May
                                                                                                                                                                                        Mar




                                                                                                                                                                                                                                                                                  Oct
                                                                                                                                                                                                                                            Jul
                                                                                                                                                                    Jan


                                                                                                                                                                            Feb




                                                                                                                                                                                                                                Jun




                                                                                                                                                                                                                                                        Aug


                                                                                                                                                                                                                                                                     Sep




                                                                                                                                                                                                                                                                                                Nov


                                                                                                                                                                                                                                                                                                             Dec
                                                                                                                                                                                                       Apr
  600
                                                          May
                                Mar


                                              Apr




                                                                                   Jul




                                                                                                                         Oct
        Jan


                    Feb




                                                                       Jun




                                                                                               Aug


                                                                                                           Sep




                                                                                                                                    Nov


                                                                                                                                              Dec




                                                                                                                                                       Source: Bloomberg, Morgan Stanley Research
Source: Department of Transportation, Morgan Stanley Research
                                                                                                                                                       Exhibit 99
Exhibit 96
Total PADD 1 (Northeast) Product Stocks (MMbbl)                                                                                                        Total PADD 4 (Rockies) Product Stocks (MMbbl)
                                                                                                                                                         14,000
  190,000                                                                                                                                                                               5 Yr Max                    5 Yr Min                  5 Yr Avg                 2010                    2011
                                        5 Yr Max                      5 Yr Min                 5 Yr Avg                  2010               2011
  180,000                                                                                                                                                13,000

  170,000
                                                                                                                                                         12,000
  160,000

  150,000                                                                                                                                                11,000

  140,000
                                                                                                                                                         10,000
  130,000

  120,000                                                                                                                                                 9,000

  110,000
                                                                                                                                                          8,000
  100,000
                                                                                                                                                                                                             May




                                                                                                                                                                                                                                                                            Oct
                                                                                                                                                                                  Mar
                                                                                                                                                                  Jan


                                                                                                                                                                          Feb




                                                                                                                                                                                                                          Jun




                                                                                                                                                                                                                                                  Aug


                                                                                                                                                                                                                                                               Sep
                                                                                                                                                                                                                                      Jul
                                                                                                                                                                                                 Apr




                                                                                                                                                                                                                                                                                         Nov


                                                                                                                                                                                                                                                                                                       Dec
                                                                May
                                      Mar


                                                    Apr




                                                                                         Jul




                                                                                                                              Oct
              Jan


                          Feb




                                                                             Jun




                                                                                                     Aug


                                                                                                                 Sep




                                                                                                                                      Nov


                                                                                                                                                 Dec




                                                                                                                                                       Source: Bloomberg, Morgan Stanley Research
Source: Bloomberg, Morgan Stanley Research
                                                                                                                                                       Exhibit 100
Exhibit 97
                                                                                                                                                       Total PADD 5 (West Coast) Product Stocks (MMbbl)
Total PADD 2 (Midwest) Product Stocks (MMbbl)
                                                                                                                                                         70,000
                                                                                                                                                                                        5 Yr Max                    5 Yr Min                 5 Yr Avg                 2010                     2011
                                            5 Yr Max                  5 Yr Min                 5 Yr Avg                  2010               2011         68,000
  140,000
                                                                                                                                                         66,000
  130,000                                                                                                                                                64,000

                                                                                                                                                         62,000
  120,000
                                                                                                                                                         60,000
  110,000                                                                                                                                                58,000

                                                                                                                                                         56,000
  100,000
                                                                                                                                                         54,000
   90,000                                                                                                                                                52,000

                                                                                                                                                         50,000
   80,000
                                                                                                                                                                                  Mar




                                                                                                                                                                                                             May
                                                                                                                                                                  Jan


                                                                                                                                                                          Feb




                                                                                                                                                                                                 Apr




                                                                                                                                                                                                                          Jun




                                                                                                                                                                                                                                                  Aug


                                                                                                                                                                                                                                                              Sep




                                                                                                                                                                                                                                                                                        Nov
                                                                                                                                                                                                                                      Jul




                                                                                                                                                                                                                                                                           Oct




                                                                                                                                                                                                                                                                                                      Dec
                                                                May
                                      Mar




                                                                                         Jul
                                                    Apr




                                                                                                                              Oct
              Jan


                          Feb




                                                                             Jun




                                                                                                     Aug


                                                                                                                 Sep




                                                                                                                                      Nov


                                                                                                                                                 Dec




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




                                                                                                                                                                                                                                                                                                             27
                                                                                                   MORGAN             STANLEY             RESEARCH

                                                                                                   October 14, 2011
                                                                                                   Refining & Marketing




Exhibit 101
US Refining and Marketing Comparable Metrics
                                                                                Ratings and Capitalization
                            10/13/2011                  Price       Equity     Enterprise   Div.             Net Debt / Cap                  Net Refining Margin / Barrel
                                  Price     Rating     Target       Value        Value     Yield          2010    2011E     2012E                2010     2011E      2012E
               VLO              $22.65       E         $29.00       13,001       16,527    0.9%            25%      13%        2%               $3.89     $6.58      $6.50
               TSO              $25.00       E         $26.00        3,610        4,726    0.4%            30%      14%        6%               $4.57     $8.88      $6.70
               SUN              $34.47       O         $53.00        4,174        4,602    1.9%            36%      50%       47%              ($0.20) ($0.80) ($0.15)
               WNR              $16.48       O         $21.00        1,809        2,519    0.0%            60%      37%        5%               $2.83    $10.25      $7.53
               ALJ               $7.54       U         $11.00         464         1,460    1.8%            75%      64%       46%              ($2.15)    $5.11      $5.56
               HFC              $32.04       O         $42.00        6,716        6,601    0.9%            63%     -12%      -63%               $3.53    $15.00     $14.32
               DK               $14.53       E         $17.00         832         1,065    1.0%            36%      11%      -21%               $1.80    $10.66      $8.75
               MPC              $33.77       O         $58.00       12,090       13,742    1.2%            27%       5%      -13%               $2.68     $8.95      $7.74
               Average                                                                     1.0%            44%      23%        1%               $2.12     $8.08      $7.12

                                                                                          Operations
                               Refining Capacity (mbpd)                      Utilization Rate                $ Gross Margin / Barrel                $ Opex / Barrel
                                 2010      2011E     2012E          2010           2011E      2012E          2010     2011E     2012E            2010   2011E       2012E
               VLO              2,780      2,865     3,000          79%             82%        85%           $7.71   $10.31     $10.12          $3.82   $3.74       $3.62
               TSO                 665       665       675          72%             86%        84%           $9.47   $13.50     $11.20          $4.91   $4.61       $4.50
               SUN                 675       505       505          96%             89%        93%           $5.04     $3.97     $4.09          $5.24   $4.77       $4.25
               WNR                 204       154       154          96%             91%        97%           $7.16   $14.93     $11.92          $4.33   $4.68       $4.39
               ALJ                 247       247       247          43%             58%        74%           $5.07   $10.94     $11.03          $7.22   $5.83       $5.47
               HFC                 256       443       443          85%             90%        92%           $8.71   $20.69     $19.64          $5.18   $5.69       $5.33
               DK                   60       140       140          83%             74%        88%           $7.00   $15.39     $13.44          $5.21   $4.74       $4.69
               MPC              1,182      1,142     1,142          99%            100%       100%           $4.13   $10.63      $9.65          $1.45   $1.68       $1.90
               Average                                              82%             84%        89%           $6.79   $12.54     $11.39          $4.67   $4.47       $4.27

                                                                                      Valuation
                                    Price / Earnings                   Price / Cons Earnings                     EV / EBITDA                      EV / Cons. EBITDA
                                  2010      2011E    2012E          2010        2011E     2012E              2010     2011E  2012E               2010    2011E    2012E
               VLO                15.4x       4.6x     4.9x         14.0x        5.2x      5.3x               5.1x      2.6x   2.7x               4.9x     2.8x     2.8x
               TSO                 NM         4.9x     6.9x          NM          5.0x      6.3x               9.0x      2.7x   3.4x               8.7x     2.8x     3.2x
               SUN                17.4x        NM       NM          19.3x        NM       17.1x               3.7x      5.5x   5.1x               4.6x     7.6x     5.3x
               WNR                 NM         4.5x     3.2x          NM          4.9x      4.7x               9.8x      3.3x   2.8x               9.7x     3.1x     3.2x
               ALJ                 NM         4.8x     2.5x          NM          5.1x      3.6x               NM        4.7x   3.5x               NM       4.5x     3.8x
               HFC                33.0x       4.7x     5.1x         33.0x        4.9x      6.2x              17.3x      2.9x   2.7x              17.7x     3.1x     3.1x
               DK                  NM         4.1x     4.1x          NM          4.5x      5.2x              16.1x      2.5x   2.4x              16.3x     2.9x     3.1x
               MPC                19.4x       4.3x     5.1x         19.1x        4.3x      5.1x               7.0x      2.6x   2.9x               7.0x     2.6x     3.0x
               Average            21.3x       4.6x     4.5x         21.3x        4.9x      6.7x               9.7x      3.3x   3.2x               9.8x     3.7x     3.4x

                                                                          Morgan Stanley Versus Consensus
                                  MS EPS Estimates                    Consensus EPS Estimate           MS EBITDA ($MM)                        Consensus EBITDA ($MM)
                                  2010   2011E     2012E             2010     2011E     2012E        2010    2011E   2012E                      2010    2011E    2012E
               VLO               $1.47   $4.89     $4.64             $1.62    $4.32     $4.29        3,258    6,297   6,101                     3,352    5,918    5,933
               TSO              ($0.33)  $5.14     $3.60            ($0.27)   $5.02     $3.99          524    1,748   1,385                       543    1,706    1,485
               SUN               $1.98   $0.68     $1.70             $1.79    $0.21     $2.01        1,229      842     895                       999      609      872
               WNR              ($0.05)  $3.70     $5.14            ($0.11)   $3.36     $3.49          257      771     889                       260      825      793
               ALJ              ($2.48)  $1.57     $2.97            ($2.41)   $1.47     $2.10          -51      311     417                       -41      322      387
               HFC               $0.97   $6.82     $6.30             $0.97    $6.51     $5.17          381    2,294   2,419                       373    2,108    2,136
               DK               ($0.36)  $3.52     $3.58            ($0.36)   $3.21     $2.78           66      431     439                        65      371      342
               MPC               $1.74   $7.80     $6.59             $1.77    $7.85     $6.62        1,952    5,343   4,687                     1,956    5,243    4,621
Source: Company data, FactSet, Morgan Stanley Research estimates. For valuation methodology and risks associated with any price targets above, please email
morganstanley.research@morganstanley.com with a request for valuation methodology and risks on a particular stock.


Valuation Methodology and Risks. Our price targets are based on a DCF value of the WTI Differential benefit, and EV/EBITDA
multiple of the remaining stub EBITDA contribution (ex-WTI differential benefit), using normalized multiples on the stub value. SUN is
valued at a sum of the parts as the company is in the process of restructuring. 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.




                                                                                                                                                                             28
                                                                      MORGAN        STANLEY       RESEARCH

                                                                      October 14, 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
    Jacob Dweck                                 Jacob.Dweck@MorganStanley.com                                (212) 761-6172
Exhibit 102
Refining and Marketing Publications
Refining & Marketing: 3Q11 Earnings Focus: Mid-con EPS 11% Higher                        Coverage Universe        7-Oct-11
Refining & Marketing: Northeast Refining: Conoco Exits Trainer - What's Next?            Coverage Universe      30-Sep-11
Refining & Marketing: Refiners Down 16.5% WoW; yet Global Inventories Tight              Coverage Universe      23-Sep-11
Life After Refining                                                                      SUN                    23-Sep-11
Refining & Marketing: Cushing Draws Again yet $24 WTI Brent: Rail Update                 Coverage Universe      16-Sep-11
Refining & Marketing: VLO 3Q EPS greater than $2/sh and Utica Deals Positive for MPC     Coverage Universe        9-Sep-11
Refining Has Value: Less-Cyclical SUN Future                                             SUN                      7-Sep-11
Refining & Marketing: Hurricanes, Advantaged SPR and WTI Crudes                          Coverage Universe        6-Sep-11
Meraux Acquisition Modest Positive - What's Next?                                        VLO                      2-Sep-11
Refining & Marketing: WTI-Brent Spread at $24/bbl is Not Acting Cyclical                 Coverage Universe      15-Aug-11
Refining & Marketing: Refining Views of a Floor                                          Coverage Universe        9-Aug-11
Crude Oil: Light-Heavy Spreads Set to Widen Again in 3Q and Beyond                       Coverage Universe        3-Aug-11
Feedstock Advantaged for Longer: Sour & Utica Crudes                                     MPC                      2-Aug-11
Refining & Marketing: Wider Sour Differentials with 2H11 Seasonal Demand                 Coverage Universe       29-Jul-11
Refining & Marketing: Refining 2Q11 Earnings Preview and Cushing Update                  Coverage Universe       22-Jul-11
Refining & Marketing: Cushing Storage Focus and COP Restructuring                        Coverage Universe       18-Jul-11
Mid-Con Fundamentals Firm, the Debate Continues…                                         Coverage Universe       11-Jul-11
Toll Road of Production Growth, Part II - Raising Estimates                              Coverage Universe       11-Jul-11
Toll Collector on the Road of Production Growth                                          MPC                       8-Jul-11
MPC & HFC Drive Focus on the Mid-Con Advantage                                           MPC/HFC                   5-Jul-11
Mid-Con Refining: On the Toll Road of Procution Growth, Part II - Raising Estimates      Coverage Universe      30-Jun-11
IEA Stock Release: It's All About Crude Quality                                          Coverage Universe      27-Jun-11
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
Source: Company data, Morgan Stanley Research




                                                                                                                        29
                                                                                MORGAN         STANLEY         RESEARCH

                                                                                October 14, 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,
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report: Evan Calio.
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As of September 30, 2011, Morgan Stanley beneficially owned 1% or more of a class of common equity securities of the following companies covered
in Morgan Stanley Research: Sunoco, Inc..
Within the last 12 months, Morgan Stanley managed or co-managed a public offering (or 144A offering) of securities of Marathon Petroleum
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Within the last 12 months, Morgan Stanley has received compensation for investment banking services from HollyFrontier Corporation, Sunoco, Inc.,
Tesoro Corp, Valero Energy Corporation.
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Corporation, Sunoco, Inc., Tesoro Corp, Valero Energy Corporation.
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HollyFrontier Corporation, Marathon Petroleum Corporation, Tesoro Corp, Valero Energy Corporation, Western Refining Inc..
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(as of September 30, 2011)
For disclosure purposes only (in accordance with NASD and NYSE requirements), we include the category headings of Buy, Hold, and Sell alongside
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                         Coverage Universe    Investment Banking Clients (IBC)
                                        % of                   % of % of Rating
Stock Rating Category       Count       Total     Count Total IBC Category
Overweight/Buy               1130        40%         457        46%         40%
Equal-weight/Hold            1168        42%         419        42%         36%
Not-Rated/Hold                112         4%           23        2%         21%
Underweight/Sell              400        14%         104        10%         26%
Total                        2,810                  1003

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.




                                                                                                                                                    30
                                                                                              MORGAN            STANLEY           RESEARCH

                                                                                              October 14, 2011
                                                                                              Refining & Marketing




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
broad market benchmark, as indicated below.
Cautious (C): The analyst views the performance of his or her industry coverage universe over the next 12-18 months with caution vs. the relevant
broad market benchmark, as indicated below.
Benchmarks for each region are as follows: North America - S&P 500; Latin America - relevant MSCI country index or MSCI Latin America Index;
Europe - MSCI Europe; Japan - TOPIX; Asia - relevant MSCI country index.
.
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