Positioning for growth: Joseph Israel on Delek’s downstream future

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Joseph Israel, executive VP and president of refining and renewables with Delek US Holdings, keeps a constant focus on business fundamentals and objectives while prioritizing safety and compliance for the Fortune 500 company.

Israel, who joined the organization in March 2023 as executive VP of operations, is responsible for overseeing Delek’s refining systems operations and performance.

"Refining operations is a dynamic and complex mission, mostly due to the amount of open variables and the changing conditions at any given moment. It requires a constant focus on the fundamentals of the business and the long term objectives while responding and adjusting to short-term considerations," Israel said.

Delek, a diversified downstream energy company with assets in petroleum refining, asphalt, renewable fuels and logistics, has refining operations located in Tyler and Big Spring, Texas, along with El Dorado, Ark. and Krotz Springs, La.

The four refineries produce a total of 302,000 b/d of crude oil throughput, converting the oil into a variety of products, including gasoline, diesel, jet fuel and asphalt.

Delek, founded in 2001, was ranked one of TIME magazine’s 2024 World’s Best Companies. Last year, Delek also completed the sale of its retail network to FEMSA’s OXXO, one of the largest convenience store chains in Latin America, a strategic move that has allowed the company to focus on core refining assets.

Israel said he’s often called on to tackle complex transformations by driving operational and marketing excellence and has an extensive background in strategic development, mergers and acquisitions, project execution, business development, operations, retail and P&L management.

With 25 years of experience in the industry, Israel previously served as president and CEO with Par Petroleum, a subsidiary of Par Pacific. He also served as senior VP with Par Pacific Holdings and as a member of the Par Pacific Board of Directors.

A key priority for Israel in his current role has been operating Delek’s assets in a safe manner, he said.

"Each deviation from that optimum will immediately translate into missed opportunities. So practically, focusing on what we can control is the name of the game — people, equipment, following our own procedures, and finally optimizing our mode of operations and cost structure," Israel said.

Safety at Delek’s facilities is a point of pride for Israel. He said in the past several years, the company has transitioned more toward leading industry indicators like near misses, safety observations and assurance.

"We are proud of our safety records and progress across the system. Both process and personal safety journeys contribute directly to reliability and environmental compliance performance. It also drives the culture we want to build in Delek US," he said.

In 2018, the company launched the "I Own It" program to emphasize the importance of individual responsibility and accountability to maintain a safe workplace. Employees at every level are encouraged to sign on to four tiers of commitment to self, others, direct reports and the company. Act safe, be safe, enable and support safety and the safety culture are key components of the program.

"Safe and compliant operations give us the right to operate. Typically, good safety and compliance records correlate well with operations reliability and efficiency," Israel said. "Beyond that, it is all about strategic positioning of the assets with enough optionality to respond to the changing market dynamics.

"Having the right people, processes and equipment makes all the difference in the world, so constant evaluation and reassessment of where we are on those three metrics is a critical key for success."

He also focuses on placing the right people in the right roles, as well as training, recruiting and retention. Keeping equipment in peak condition with preventative maintenance and running the right feedstock while producing the right products based on unit availability and market environment is also key, he said.

"Beyond what we can control, there is an entire universe of things to watch. As an example, weather conditions, outside the fence, logistics and power outages can easily impact operations in the short term," Israel said. "And then, on a more strategic level, regulatory requirements and supply and demand dynamics mainly impact the way we think about investments."

Israel sees the future growth of Delek in the changing of consumer appetites around high-octane and specialty products, as well as trends in demand for jet fuel, distillate and asphalt, which he said appear to be more sustainable than gasoline.

"This is where our innovation focus is. In addition, we continue to develop our system as a platform for growth to accommodate any future potential growth," Israel said.

In addition, the continuing development of cleaner and more efficient energy alternatives will be a key focus for Delek, he said.

"With regards to refining and more specifically, U.S. refining, I love our positioning. The unique combination of oil and low-cost energy sourcing, high complexity refineries and the best engineers on the planet gives U.S. refining the advantage over global competition and will continue to support a robust export-driven business model," Israel said.

"In the short- and midterm, there isn’t enough new refining capacity coming online to offset global demand growth. Light products inventory is already on the low side, and the support for favorable refining margins in the coming couple of years is definitely there."

"Our industry is cyclical and volatile, and as always, the global economy, geopolitical dynamics and special weather conditions will continue to drive short term trades."

Israel said recent legislation to positively affect the industry was the overturn of the Advanced Clean Cars II regulation, which bans the sale of new gas cars. "It was an extremely important win, not only for us as an industry, but most importantly to consumers’ freedom of choice in the U.S.," he added.

"Secondly, the EPA recently made good progress with its Small Refinery Exemption provision, and a lot is left to unfold by year’s end at the Renewable Fuel Standard program level," he said.

Israel earned a master’s degree in economics and an MBA from Hebrew University of Jerusalem and started his career with energy and infrastructure responsibilities under the Israeli government. After five years, he got the unique opportunity to jump into the private sector when Israeli company Alon purchased the downstream assets of TotalFina in the U.S.

After closing that deal in the summer of 2000, Israel and his wife moved to Texas. He started on the business side as VP of mergers and acquisitions and corporate development, and over a period of eight years, the company went public. Israel helped grow the portfolio from one refinery in West Texas to four refineries and 11 asphalt terminals.

In 2008, he was promoted to COO for Alon USA and assumed operations responsibilities. In 2011, he moved to Hunt Oil as senior VP for the refining company.

Throughout his career, he has learned valuable lessons, including staying focused on what he can control and knowing that change is constant.

A defining role model was the leader of TotalFina’s U.S. refining business, Jeff Morris, whom Israel worked under when Morris became the CEO of Alon USA.

"Beyond being a bright chemical engineer, it was the detailed and transparent leadership style which I found special and effective in many ways," Israel said. "I also admired the patience he had to keep mentoring young leaders around him, no matter how busy things got. I was fortunate to have him as a key mentor early in my career."

Now at the helm of Delek’s downstream operations, Israel has come full circle — helping grow pieces of the portfolio he helped build two decades ago.

For more information, visit delekus.com.

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