SK Innovation sees refining margin solid as demand recovers

SEOUL SK Innovation Co Ltd, owner of South Korea's top refiner SK Energy, said on Tuesday that it expects its refining margin this year to be solid as COVID 19 retreats and China's demand recovers.

The company posted an operating loss of 683 billion won $543.28 million in October-December, compared to a loss of 62 billion won a year earlier.

Revenue rose by 40 per cent to 19 trillion won, slightly less than the average analyst estimate of 20 trillion won, according to Refinitiv SmartEstimate.

SK Innovation, which has a total refining capacity of 1.115 million barrels per day bpd at its plants in Ulsan and Incheon, said it operated its facilities at 71 per cent of capacity on average in the quarter, down from 85 per cent in the third quarter.

Peer S-Oil Corp, whose main shareholder is Saudi Aramco, said last week that Asia's regional refining margins were expected to remain elevated in 2023 over pre- 2022 levels despite ongoing refinery shortages.

Shares of SK Innovation, which provides batteries for electric vehicles EV, were trading down 0.1 per cent in morning trade, compared to a 0.2 per cent rise in KOSPI.