By Emily Russell
The Houston-based oil and gas company Phillips 66 is named after the bygone era of early American automobiles that drove Route 66 -- and were fueled by Phillips Petroleum's 66 octane gasoline.
Phillips Petroleum later merged into ConocoPhillips. When ConocoPhillips split in two in 2012, Phillips 66 was created. It took on the down- and mid-stream operations, which encompass all stages of transforming natural gas liquids and crude oil into usable end-products, such as gasoline and jet fuel.
"Downstream is a great business," the company's CEO, Mark Lashier, told Barron's editor at large Andy Serwer in an interview for the At Barron's video series.
Lashier, who has a Ph.D. in chemical engineering, became head of the company in 2022. Phillips 66's stock struggled against its competitors at the start of his tenure, but ended 2025 by beating the S&P 500 by 3%.
The stock popped 9% this week after the Trump administration captured Venezuelan President Nicolás Maduro and said the U.S. will take control of Venezuela's vast heavy crude reserves.
Heavy crude requires more complex refineries than those that process the lighter, sweeter oil the U.S. mostly pumps today. Phillips 66 already has refineries that can process heavy crudes; they have been processing heavy crude from Canada for years.
A Phillips 66 spokesperson said the company is "monitoring developments" in Venezuela, including implications for energy markets, and that "events like these underscore the importance of strong U.S. energy leadership."
In conversation with Serwer, Lashier discussed Venezuela's resources, the outlook for the global energy market, and his thoughts on the Paramount+ drama Landman , which depicts a rough and tough Texan oil industry.
Below is an edited version of that discussion, which was recorded before the U.S. intervention in Venezuela.
Barron's: How do you view the energy resources the U.S. has versus those in other countries, in particular in Venezuela? How important is it to develop those resources to bring them into the U.S. market?
Mark Lashier: It is very important for the U.S. economy, and even for national security, that we have a wide variety of crudes that we can access. We should be able to ensure that we can access the optimum crudes for our economy.
Phillip 66 has built into our facilities, and continues to invest in, opportunities to be flexible on which crudes we can operate. For instance, we have assets that were built designed to process heavy crudes from Venezuela. We want flexibility to be able to process whatever crude makes the most sense at the moment.
How would you characterize the overall oil and gas sector right now?
I think it is healthy. Crude oil prices are off a bit because of various geopolitical events. But refining is in a really good spot; demand just keeps ticking up on a global basis.
What about demand for your end products, such as fuel? How do you see that playing out over the next few years?
We see North America demand plateauing, but global demand for refined products continuing to rise 1-2% a year. And refining capacity is being rationalized globally, not just in the U.S. We continue to see a little more tightness every year in refining. That is constructive for our business.
Elliot Management has been an activist shareholder in Phillips 66, critical of the company's integrated approach. Why do you think integration makes sense?
We didn't just have these assets appear overnight and then push them together artificially. They have grown organically, primarily around our Sweeney complex in South Texas. We have been able to maximize the utility of that refinery by having petrochemical facilities. They share resources; it is very synergistic. That creates a competitive advantage for us that we lean into that very hard.
Our latest integration is the Western Gateway pipeline, which will take jet fuel, gasoline, and diesel all the way from St. Louis to Santa Monica.
Phillips 66 outperformed the S&P 500 last year. What drove that?
We took more than a dollar per barrel out of our cost structure in our refining business, which is dramatic. That is billions of dollars overall. We also undertook efforts to enhance our ability to capture more margin. We invested in a number of low-capital, high-return projects that have allowed us to make more jet fuel, to be more flexible in the crudes that we process, and to make higher-octane gasoline.
We also sold $5 billion worth of non-core assets in the last few years and redeployed that capital -- either returning it to shareholders or investing in higher-value opportunities.
At the end of the day though, this is a commodity business. How do you address the volatility that comes with that?
We focus on the things that we can control. We can control our costs, so we drive those down to a responsible level. We don't want to put our assets at risk, so we want safe, reliable operations. And then we focus on how we can maximize the margin of every barrel of oil or natural gas liquids that we process.
What is your take on the current state of regulation?
We have been advocating for more consistent regulation on new infrastructure and pipelines that cross state lines. We can't afford to invest in things that have perpetual challenges in courts. As the AI boom goes forward, we are going to need more and more power. So we need the ability to get projects approved efficiently and have that approval sustained.
How do political swings in the regulatory landscape inform your business outlook?
First and foremost, we have to focus on the things that we can control. But then we also have to engage in the political process. Some politicians are working in earnest to do the right things, but sometimes they don't understand the unintended consequences of their decisions. So we spend a lot of time talking to federal, state, and local politicians about what their policies will do to our industry.
Finally, do you watch Landman?
I enjoy watching Landman. It is a little hyped, and the industry is much safer than what is portrayed. But Billy Bob Thornton has given some great speeches in the show about the energy industry and how important it is. I tell my kids, 'You see that speech Billy Bob gave? I have given that same speech about a dozen times, without the f-bombs.'
It is about how hydrocarbons are very important to the global economy. You can't just throw that all away and hope that something else can take its place. We have to be very deliberate as we evolve the energy system to lower-carbon. We are doing that every day.
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January 10, 2026 01:00 ET (06:00 GMT)
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