UPDATE 2-Tesoro reports Q2 loss, tops Wall St view

* Q2 loss 33 cts/share tops Wall St view

* Refinery throughput down 7 pct from Q2 2008

* Shares down more than 2 percent (Adds detail from the quarter, exec quotes)

NEW YORK, July 29 (Reuters) - Oil refiner Tesoro Petroleum Corp (TSO.N) recorded a quarterly loss compared with a year-ago profit on Wednesday as weak fuel demand and high inventories hurt refining margins.

Distillate inventories in the United States have risen near a 25-year high as the recession dented industrial and trucking demand, according to U.S. government data released on Wednesday.

"As we began 2009, we were prepared for a very difficult year, and in the second quarter it arrived," Bruce Smith, chairman and chief executive, said in a statement.

The quarterly loss was caused in part by dismal profit margins for the production of distillate fuels like heating oil and diesel, as well as shrinking discounts for heavy crude oil that Tesoro uses.

Heavy crudes represent almost 70 percent of Tesoro's crude slate in the California region and discounts for spot California heavy crudes were down 45 percent.

Tesoro's net loss in the second quarter was $45 million, or 33 cents per share, compared with net profit of $4 million, or 3 cents a share, last year.

Analysts on average had expected a loss of 40 cents per share, according to Reuters Estimates.

"They beat consensus, but it's still a loss. It's definitely not a strong result," said Chi Chow, an analyst at Tristone Capital

Still, the figures were consistent with top U.S. refiner Valero Energy Corporation (VLO.N), which reported second quarter losses on Tuesday on weak profit margins, Chow said.

The company's gross refining margins dropped 16 percent to $8.52 per barrel, down from $10.10 per barrel in the second quarter of 2008.

The amount of oil and other products processed by the San-Antonio based refiner fell 7 percent in the quarter to 565,000 barrels per day.

Maintenance at Tesoro's Alaska refinery and planned maintenance at its Golden Eagle refinery in California also contributed to lower refinery throughputs, the company said.

Smith said the company anticipates difficult market conditions to continue through the third quarter of 2009.

"In July, record product inventories and narrow heavy-light crude oil differentials continued to hamper margins. We are prepared for this environment to persist," he said.

Its shares slipped 2.4 percent in extended trade to $12.75.

(Reporting by Rebekah Kebede; Editing Bernard Orr)