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New Upgrade Fuels Refining Sector

Deutsche Bank upgraded the entire refining sector and raised price targets in a long piece entitled, "Oil has a future-so do refineries."

The argument:

1) demand improving, helped by cold weather, though still weak;

2) inventory overhang being worked off due to refinery shutdowns, with utilization low in those that are operating;

3) oil prices will FALL in 2010 to $65 a barrel, which will improve margins for gasoline refiners.

DB energy analyst Paul Sankey does hedge his bets: "Our biggest concern in 2010 is a major terrorist attack. Post-911 impact suggests that this will be very negative for oil demand, and refiners."

Tesoro up 7 percent, Sunoco up 5 percent, Valero up 5 percent.

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