S-Oil announced on the 30th that it achieved sales of 8.9996 trillion KRW and an operating profit of 858.9 billion KRW in the third quarter of this year. Compared to the same period last year, sales decreased by 19.1%, but operating profit increased by 67.9%. Compared to the previous quarter, sales rose by 15.1%, and operating profit surged by 2258.5%. Net profit for the period was 545.4 billion KRW, turning positive compared to both the previous year and the previous quarter.
Regarding the third-quarter performance, S-Oil explained, "Operating profit increased significantly due to strong refining margins and rising oil prices driven by robust demand for petroleum products."
By business segment, the refining division recorded sales of 7.1987 trillion KRW and an operating profit of 666.2 billion KRW. Asian refining margins rebounded sharply. This was influenced by tight supply conditions due to operational disruptions at regional production facilities and strong demand during the summer driving and peak aviation travel seasons. Dubai crude oil prices rose due to the extension of OPEC+ voluntary production cuts and a decrease in global crude oil inventories.
The petrochemical division posted sales of 1.1248 trillion KRW and an operating profit of 45.4 billion KRW. The markets for core products paraxylene (PX) and benzene maintained a solid level due to steady demand for aromatic products used as raw materials for gasoline blending and the operation of new large-scale downstream facilities in the region, which brought in new demand. The polypropylene (PP) and propylene oxide (PO) markets showed weakness due to downstream demand contraction caused by new regional facility operations and a slowdown in China's manufacturing sector.
The lubricants division recorded sales of 676.1 billion KRW and an operating profit of 147.2 billion KRW. The lubricant base oil spread narrowed compared to the previous quarter due to seasonal off-peak demand and the completion of regular maintenance by major suppliers, but it still exceeded the historical average level.
S-Oil stated that global petroleum product inventories have fallen below historical ranges due to sustained growth in refining product demand throughout the year as mobility demand recovered. Regarding financing for the Shahin project, the company explained, "We have completed negotiations on key terms for loans from the major shareholder and bank borrowing agreements at competitive low interest rates compared to market rates."
Regarding the market outlook for the fourth quarter, S-Oil said, "Asian refining margins are expected to remain robust due to low global inventories, limited supply growth conditions, and increased winter demand."
It added, "The PX and benzene markets are expected to undergo adjustments due to increased aromatic product production amid seasonal easing of the strong gasoline market, but support will come from the restart of downstream facilities after regular maintenance. The PP and PO markets are expected to recover following improved consumer demand after the Chinese National Day holiday and adjustments in facility operating rates considering company economics." The lubricant base oil spread is also forecasted to improve slightly due to tight supply from regular maintenance and yield adjustments, along with gradual demand recovery.
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