It has been found that South Korean oil and petrochemical companies are adjusting upward their quarterly sales and profit estimates for the fourth quarter of this year one after another.
This is because international oil prices are on the rise, based on crude oil exporting countries’ agreement on production cut, along with the prices of petrochemical products.
Examples of such petrochemical products that are showing an increase in price include ethylene and propylene, the prices of which have increased rapidly since late last month.
In addition, those of acrylonitrile butadiene styrene (ABS) and high-density polyethylene (HDPE) used in shopping bags, toys and so on are rising nowadays because of an increase in demand in China. Earlier, both Lotte Chemical and LG Chem announced that they would increase their ethylene production to a large extent in step with the market conditions.
“The combined operating profit of the top four companies in the industry, that is, SK Innovation, GS Caltex, S-Oil and Hyundai Oil Bank, is forecast to exceed seven trillion won (US$6.3 billion) this year,” said an industry source, adding, “The previous high is 6.8135 trillion won (US$6.13 billion), recorded in 2011.”