Feb 14, 2012:

A boom in North American oil production will benefit many U.S. refineries with large supplies of lower-priced crudes, an Oppenheimer & Co. analyst said Tuesday. American refineries have struggled mightily during the past few months as gasoline demand plunged to the lowest level since 2001. Several have closed their doors, and many others posted hefty fourth-quarter losses.

Analyst Fadel Gheit said the industry is poised for a rebound in 2012. Gheit expects some refineries to benefit from the increased flow of crude from Canada's oil sands and America's shale regions. Those crudes have been trading at a big discount to international crudes. Refineries with access to those domestic and Canadian crudes will "continue to enjoy a significant crude cost advantage over the competition," Gheit said. Besides the lower raw material costs, U.S. refineries will be able to crank up production this year to make up for competitors' shutdowns in 2011. That should increase profit margins further. Gheit said refiners such as Tesoro Corp. and Valero Energy Corp. should outperform their peers, given their access to U.S. and Canadian crudes. Shares of both companies also have been trading at "significant discounts" to other refining companies, Gheit said.

In afternoon trading Tesoro shares rose 75 cents, or 2.7 percent, to $28.39. Valero rose by 10 cents to $24.55 per share.

By CBS News