SEOUL, November 02 (AJP) - S-Oil's third-quarter operating profit rose more than sixfold from a year earlier, the company said on Monday, as supply disruptions in the Middle East kept refining margins and lubricant spreads high.
According to regulatory filings, operating profit came to 1.41 trillion won ($1.04 billion) in the July to September period, up 513.7 percent from 229.2 billion won a year earlier.
Revenue rose 42.2 percent to 11.97 trillion won on higher crude prices. Net profit jumped to 1.44 trillion won from 63.2 billion won, the company explaining that all of it was attributable to shareholders of the parent company.
The lubricants division earned more than refining for the quarter.
Its operating profit climbed to 742.7 billion won from 133.6 billion won, and revenue more than doubled to 1.54 trillion won.
Spreads for base oil, the main ingredient of engine oil, widened as production disruptions and shipping constraints in the Middle East dragged on, especially for high-grade Group III products, S-Oil explained.
The refining business posted an operating profit of 690.4 billion won, up from 115.5 billion won a year earlier, on revenue of 9.06 trillion won. Crude prices surged on rising tensions in the Middle East, and refining margins stayed high as tight fuel supplies persisted.
The petrochemical division's operating loss widened to 26.4 billion won from 19.9 billion won, even though revenue rose 34 percent to 1.36 trillion won.
Aromatics spreads improved as regional plants shut for maintenance. Spreads for polypropylene and propylene oxide, which are plastic and chemical feedstocks, narrowed on oversupply and weak seasonal demand.
The Saudi Aramco-controlled refiner said in a statement that it kept its plants running steadily by securing crude through long-term contracts, alternative grades and swaps of government strategic reserves.
It also moved oil through ship-to-ship transfers while the Middle East conflict disrupted supply and shipping routes.
The company expects refining to stay strong in the fourth quarter, citing low global inventories and the start of the heating-oil season.
S-Oil said trial runs are underway at its Shaheen petrochemical project in Ulsan after mechanical completion of the main facilities. Commercial operation is targeted for early 2027.
Shares of S-Oil were up 3.25 percent at 127,000 won as of 2:26 p.m.
AJP Takeaways
- S-Oil reported third-quarter 2026 operating profit of 1.41 trillion won on Nov. 2, 2026, up 513.7 percent from 229.2 billion won a year earlier, according to its preliminary earnings filing.
- Revenue rose 42.2 percent to 11.97 trillion won. The lubricants division's operating profit of 742.7 billion won exceeded refining's 690.4 billion won.
- S-Oil is running trial operations at its Shaheen petrochemical project and is targeting commercial operation in early 2027.
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