Sunoco to sell refinery business, keep gas stations

Sunoco Inc. plans to end nearly 120 years in the U.S. refining business, selling off its two remaining plants as higher crude prices and slumping demand squeezed profits in the latest restructuring of the sector.

The Philadelphia company will remain a gasoline retailer through its 4,900 stations across the East Coast and Midwest, but will put its two Pennsylvania refineries on the block.

The move is the latest shift in the U.S. refining market, which has seen a wave of companies disposing of refining assets, selling off plants or mothballing them over the last two years as firms reorganize businesses to adjust to the changing economics in the oil products markets.

U.S. refiners have seen profits squeezed by sluggish demand because of the weaker economy and strong crude oil prices. Chief Executive Lynn Elsenhans said the refining segment operated at a loss in eight of the last 10 quarters.

“It is in the best interests of shareholders to exit this business and focus on our profitable retail and logistics businesses,” Elsenhans said in a statement Tuesday.

If the company is unable to strike a deal to sell the plants by July 2012, it plans to idle the two main processing units at the facilities.