Petron Profit Dips 27% Amid High Oil Prices, Fuel Security Concerns Emerge

MANILA, Philippines — Elevated crude oil prices and freight costs triggered by the ongoing Middle East war dragged down Petron Corp.’s earnings in the first six months. The Philippines’ only remaining oil refiner delivered a net income of P3.8 billion in the first half, 27 percent lower than the P5.3 billion earned a year ago. Similarly, operating income plunged by 17 percent to P12.6 billion despite a sharp increase in revenues. Petron saw revenues surge by 57 percent to P605.9 billion from P386.4 billion on a yearly basis, but higher product costs and operating expenses squeezed its margins. Global oil markets faced heightened volatility after the US-Iran conflict erupted in late February, pushing benchmark Dubai crude prices to $129 per barrel in March. Although prices later fell below $80 a barrel, Dubai crude still averaged $96 per barrel in the second quarter, up from the previous quarter’s $86-per-barrel average. “While the first half of the year has been challenging, we are confident that our financial discipline, operational resilience and competitive strengths will enable us to navigate these temporary headwinds,” Petron chairman and CEO Ramon Ang said. Petron, which operates a Bataan refinery capable of producing 180,000 barrels of oil per day, remains committed to helping ensure the country’s fuel security amid persistent market volatility, Ang added. From January to June, Petron’s consolidated sales volume grew by six percent to 67.9 million barrels, driven by strong trading activity from its Singapore subsidiary. The growth helped offset a six-percent decline in combined sales volume from Philippine and Malaysian operations, which totaled 52.9 million barrels during the period. In the Philippines, the company’s retail fuel segment posted a 15-percent increase, but lower refining output tempered the gains. The Bataan facility completed a maintenance shutdown in the first quarter, while the Port Dickson Refinery in Malaysia temporarily halted production after its product jetty was damaged by a typhoon. Meanwhile, Petron’s coco-methyl ester plant within the Bataan refinery complex is nearing completion. With an annual capacity of 180,000 tons, the facility is expected to provide the oil giant with a more reliable supply of CME.