Asia oil refining margins drop to two-year low as gasoline profit plunges
Singapore refining margins, the benchmark for profitability among oil processors in Asia, fell to their lowest in two years, dragged down by lower gasoline margins as refiners have ramped up output.
Margins at a typical complex refinery in Singapore dropped to $4.28 a barrel at the market close on Monday, the lowest since August 2016, according to Thomson Reuters data. Among oil products, gasoline margins fell the most, dropping by half in the past month to under $5 a barrel.
“Refineries in the region have been processing lighter crude as the margins for naphtha and gasoline have been quite good up until recently,” said a Singapore-based crude oil trader.
“So (the drop in margin) may mean a switch in crude or yield again, but it will take a while to take effect. The (refining) margins are getting very compressed now.”