(Reuters) – U.S. refiner Phillips 66 PSX.N reported a smaller-than-expected quarterly loss on Friday, as its marketing and specialties unit, which retails refined products, benefited from people returning to gas stations.

The unit buys refined products wholesale to resell at over 9,100 outlets the company operates through a joint venture, and has seen demand recover as coronavirus-related lockdowns ease and travel gradually picks up.

On a sequential basis, marketing fuel margins improved 27.4% in the third quarter to $2.23 per barrel in the United States and up 24% to $6.28 per barrel internationally.

However, realized refining margins slumped to $1.78 per barrel, a 31.5% drop from the second quarter and 84% lower than last year, hit by weak fuel demand though oil prices have ticked up from spring lows.

Adjusted loss for the refining segment came at $970 million, wider than $867 million posted in the second-quarter.

Results in the third quarter were also hit by impairment charges of $798 million related to the planned conversion of a San Francisco refinery into a renewable fuels plan.

The company had said in August it will reconfigure the refinery in Rodeo to produce renewable fuels, which are made from used cooking oil and fats, among others, and have seen an increased demand in recent months as they burn cleaner than traditional diesel.

The Houston, Texas-based company reported a net loss of $799 million, or $1.82 per share, for the quarter ended Sept. 30, from a year-ago profit of $712 million, or $1.58 per share.

On an adjusted basis, it lost a cent per share, smaller than average analysts’ estimate of 80 cents, according to Refinitiv IBES.