SEOUL: South Korea’s S-Oil Corp and Hyundai Oilbank Co Ltd have cut refinery runs for different reasons, but throughput reduction may further lift the refining margins, which were recently seen higher, traders said on Monday.
S-Oil, the third largest South Korean refiner by capacity, has a month-long scheduled maintenance at a 240,000 barrels per day (bpd) crude distillation unit (CDU) starting this week while the country’s smallest refiner, Hyundai Oilbank, has trimmed runs due to squeezed margins, they added.
Trade sources said S-Oil’s average throughput in August at its 669,000-bpd refinery in Ulsan is likely down by more than 10 per cent to below 85 per cent compared to July. Spokesmen at the two refiners declined to comment on their runs.
August throughput at Hyundai Oilbank, which operates a 390,000-bpd refinery in Daesan, has been reduced by about 5 percentage points compared to nearly full capacity in July, they added.
Hyundai Oilbank’s run cuts to combat poor refining margins caused by ample middle distillates stocks were in line with similar measures taken by GS Caltex while SK Energy is looking into run cuts.
The complex refining margins in the Singapore hub have averaged around $6.50 a barrel over the last week, about $1 up from the July average. China’s refinery throughput in July at 10.25 million bpd was down nearly 3 per cent versus June but the reasons behind the lower runs were not clear.
