South Korean refiner S-Oil’s base oils profit-margin extended its recovery in the third quarter of the year amid steady feedstock costs and higher Group III base oils prices in markets like Europe.
The base oils unit’s operating profit-margin of 19.0% in the three months to end-September rose from 17.5% during the second quarter and from less than 14% in the first three months of the year.
The base oil unit's profit margin in the first quarter was the lowest in more than four years and followed a sustained slide in global Group III base oils prices from around mid-2023.
Those prices steadied then began to rise from the first half of this year ahead of a heavy round of Group III plant-maintenance work in the Middle East.
S-Oil’s base oils unit saw its sales account for 8.4% of the refiner’s total sales in the third quarter.
Its share of total sales held in a similar range over the past year.
The unit’s operating-profit accounted for 58% of the refiner’s total profit in the third quarter.
Its profit in the first half of the year contrasted with and was insufficient to cover the loss posted by S-Oil’s refining and petrochemicals units during that period.
