South Korean refiner S-Oil saw profit from its base oils and lube unit fall in the third quarter to the lowest in almost three years in the face of rising feedstock costs and falling base oil prices.The unit’s operating profit of 147.2bn South Korean won ($109mn) in the three months to end-September fell by 61pc from year-earlier levels and by 40pc from the previous quarter.Profit fell as sales of W676.1bn slid by 28pc from year-earlier levels and 17pc from the previous quarter to the lowest since first-half 2021.Sales fell partly because of lower sales volumes.The unit’s base oils production of around 495,000t in the third quarter was down more than 30,000t from the same period last year.Production fell because of plant maintenance work that ended in July 2023.Lower base oils prices compounded the drop in sales.Asia Group II base oils prices fell by more than 20pc in the third quarter from year-earlier levels and by 5pc from the second quarter, ICIS data showed.Asia Group III prices fell by 5pc in the third quarter from the previous quarter.Lower base oils prices contrasted with an 11pc rise in crude oil prices during the third quarter from the previous three months.With costs rising and sales falling, the unit’s operating profit margin fell to 21.8pc in the third quarter.The profit margin fell from 30.4pc in the second quarter to the lowest since 2019.The unit’s sales accounted for 8pc of S-Oil’s total revenue and 17pc of its total profit in the third quarter..S-Oil’s Q2 lube profit falls
