Russian Crude Oil Imports Halved... Petroleum Products Surpass Cars to Become 4th Largest Export Item

▲A view of the Nexlene plant within SK Innovation's Ulsan Complex, the largest oil refining company in Korea

[Asia Economy Reporter Oh Hyung-gil] The export volume of petroleum products by oil refiners in the first quarter reached the highest level in 11 years.

According to the Korea Petroleum Association on the 26th, the export volume of petroleum products from the four major refiners?SK Energy, GS Caltex, S-OIL, and Hyundai Oilbank?was 108.99 million barrels, a 20.0% increase compared to the same period last year. This is the highest growth rate since the first quarter of 2011 (25.6%).

The export value reached $12.03 billion, up 95.3% from the same period last year. The export value growth rate is also the highest in 22 years since 2000 (118.2%).

This phenomenon is attributed to the base effect from last year's COVID-19 pandemic, increased demand for petroleum products due to the easing of COVID-19 spread, and rising petroleum product prices driven by international oil price increases.

Among the country's major export items in the first quarter, petroleum products ranked 4th, surpassing automobiles and moving up one position compared to the previous year.

Experts forecast a steady recovery in global oil demand going forward. The Organization of the Petroleum Exporting Countries (OPEC) stated in its monthly report issued this month that due to factors such as global economic growth, daily oil demand this year is expected to increase progressively from 98.95 million barrels in Q1, 99.12 million barrels in Q2, 101.06 million barrels in Q3, to 102.81 million barrels in Q4.

The export profitability, calculated by subtracting the crude oil import price from the petroleum product export price, also recorded $19.5 per barrel, a significant increase from $8.8 per barrel last year, greatly contributing to the strong performance of refiners.

The main export destinations for petroleum products were Australia (13.2%), China (12.7%), Singapore (12.6%), Japan (9.8%), and Vietnam (9.1%), in that order.

Domestic refiners have significantly reduced imports of Russian crude oil following Russia's invasion of Ukraine. In March, the total crude oil imports were 85.55 million barrels, of which Russian crude accounted for 2.97 million barrels, a 43% decrease compared to 5.28 million barrels in the same month last year.

Since the beginning of this year, Russian crude oil imports have decreased from 5.24 million barrels in January to 3.64 million barrels in February, and continued to decline sharply in March.

Domestic refiners have replaced Russian crude imports by increasing crude oil imports from Kazakhstan and Iraq.

Crude oil imports from Kazakhstan rose from 3.15 million barrels in February to 5.27 million barrels in March, while Iraqi crude imports increased from 5.8 million barrels to 6.35 million barrels during the same period.

The countries from which the most crude oil was imported in March were Saudi Arabia with 28.06 million barrels, the United States with 11.67 million barrels, and Kuwait with 11.24 million barrels.

Meanwhile, the refining margin, which indicates refiners' profits, is at an all-time high. As of the fourth week of April, the Singapore complex refining margin rose by $0.52 from the previous week ($18.15) to $18.67 per barrel.

The refining margin, which stayed between $5 and $7 per barrel in January and February, surged to $12.1 per barrel in the second week of March when Russia's invasion of Ukraine intensified, and reached an all-time high of $13.87 per barrel in the fourth week of March, maintaining record highs for five consecutive weeks.

This content was produced with the assistance of AI translation services.