Thai Oil expects refinery business to improve in the second half of the year

Bangkok, Thai Oil announced its operating results for Q2/2024, which doubled compared to the same period last year, but decreased compared to Q1/2024 due to the surge in crude oil prices, resulting in a decrease in gross profit. It is expected that the refining business will improve in the second half of the year due to the seasonal increase in global oil demand. Mr. Bandit Thammaprajamjit, Chief Executive Officer and President of Thai Oil Public Company Limited (TOP), revealed that in the second quarter of 2024, Thai Oil Group had a net profit of 5,547 million baht, up 101.2% from the same period last year, which had a net profit of 5,671 million baht, but slightly down from the first quarter. In the first quarter of this year, the net profit was 5,862 million baht from the difference in product prices with Dubai crude oil, which was pressured by increased supply from the start of refineries in Africa, as well as the difficulty of exporting from Asia to Europe. Aromatics business improved from the spread o f paraxylene and benzene with gasoline 95, which increased from the increased demand in late summer of most countries in Asia for use in downstream industries for producing drinking water bottles and the tight supply from the annual maintenance shutdown of aromatics producers in the region. In addition, the feedstock business for detergent products improved after being supported by the increased demand for detergent products in most countries in Asia during the summer. The lubricant base oil business decreased from the spread of lubricant base oil and asphalt with fuel oil from the increased fuel oil price. Crude oil prices in Q2/2024 increased from Q1/2024 due to concerns over tight crude oil supply from the geopolitical conflict in the Middle East, which is still uncertain. In addition, the OPEC and its allies (OPEC+) crude oil producers continued to extend the period of reducing production capacity until Q3/2024, resulting in Thaioil Group having a profit from oil stock of 1,395 million baht or 1.4 USD pe r barrel and having a gross profit from the group's production including the impact from oil stock of 7.0 USD per barrel in Q2/2024, down 3.5 USD per barrel from Q1/2024. For the overall refinery business in the second half of the year, there is a tendency to improve from the second quarter, supported by the seasonal increase in oil demand, both during the driving season in the US, the continued increase in air travel, and the demand for heating oil. In addition, the refining margin is also supported by the volume of finished oil inventories, which, although increasing, remain at a level close to the 5-year average. In addition, during August-October, the market is still watching the situation of hurricanes in the Atlantic Sea, which are expected to be more numerous this year than last year, which will affect both demand and supply. However, the opening of new refineries in Africa will put limited pressure on refining margins, while concerns about the global economy, due to poor economic figures from both t he US and China, may put pressure on crude oil prices in the second half of the year. Thaioil will closely monitor global economic trends and market situations to prepare for any possible fluctuations, including seeking new business opportunities that meet Megatrends in order to build on sustainable growth for the organization for 100 years. Source : Thai News Agency