Operating profit for the SK Enmove base oils and lubricants business declined 22% to ₩261.7 billion for the quarter ending Sept. 30, compared to 336 billion.

Sales decreased 16% to ₩1.2 trillion, compared to ₩1.4 trillion.

S-Oil

S-Oil reported ₩147.2 billion in operating income for its base oils and lubricants business in the third quarter, a 59% fall from ₩376.7 billion.

Sales in the third quarter slipped 28% to ₩676.1 billion, compared to ₩945.4 billion.

The products spread in Asia between base oil composite prices and vacuum gas oil averaged $55.20 per barrel in the third quarter, S-Oil said in in its earnings presentation. In previous earnings presentations, the company referred to the products spread based on high sulfur fuel oil pricing. That’s 32% lower than $81.20/bbl in the same quarter last year and a 19% decrease sequentially from $68.20/bbl in this year’s second quarter. 

The company noted that while the base oil price spread maintained above historical average levels, it declined sequentially from the previous quarter due to subdued demand during the off-peak season and the end of scheduled maintenance of major base oil suppliers.

Hyundai Shell Base Oil

Hyundai Shell Base Oil, the joint venture between Hyundai and Shell that produces Group II base oil, reported a 62% drop in operating profit to ₩19 billion for the third quarter, compared to ₩50.4 billion.

Sales in the quarter declined 26% to ₩287.4 billion, from ₩388.7 billion.

Hyundai Oilbank noted that base oil margins turned weak in the third quarter due to a rise in oil prices and the impacts of a decrease in demand in Asia because of the aftermath of the monsoon season in India.

The base oil spread for 500 neutral was down to $118 per barrel in the third quarter, 58% lower than $280/bbl in the same period last year, while the base oil spread for 150N was down 69% to $74/bbl in the third quarter, compared to $238/bbl.