In the first half of 2020, two South Korean refiners posted record-high losses as the coronavirus pandemic harmed global demand.
SK Energy, owned by SK Innovation Co. Ltd., posted a slump in operating loss in the second quarter at KRW440 billion (USD367 million), compared to KRW494 billion (USD414.27 million) in the same period a year ago. The first-half losses this year were driven to KRW2.2 trillion (USD1.8 billion).
S-Oil Corp., South Korea’s third-biggest refiner, also noted its biggest first-half loss at KRW1.2 trillion (USD1 billion).
SK Innovation’s capacity utilization rate (CUR) was 77% in the second quarter out of its nameplate capacity of 1.115 million bpd, down from 88% in the corresponding period of 2019. The lower rate came as SK Energy closed for planned maintenance in May and June its 260,000 bpd No.5 crude distillation unit (CDU) at Ulsan.
An official said that the company had to purposely cut its capacity as the pandemic battered oil demand, resulting in the worst oil price in the first half of the year.
Looking ahead, SK Innovation will shut its No.3 CDU at its Ulsan plant in the second half of 2020. The company did not share more details on the shutdown.
Any recovery in fuel demand is still deemed uneven as the resurgences in coronavirus are still putting the new restriction as an option.
