South Korean refiner SK Innovation expects refining margins to improve in H2 2023. Factors include China’s economy reopening and the US driving season boosting oil demand. Supply constraints easing with more production coming online also contribute.
Recent pressures on SK Innovation’s refining margins were due to the Russia-Ukraine war and COVID-19. The company foresees easing of these factors in H2, leading to higher margins.
Analysts, like S&P Global Platts, share SK Innovation’s optimistic view, forecasting global refining margins to rise.
Despite risks like a slowdown in the global economy or supply disruptions, SK Innovation remains positive about gradual improvements in H2 2023.
The company cited several factors for this outlook, including:
- The reopening of China’s economy, which is expected to boost demand for oil products.
- The summer driving season in the United States, which is also expected to boost demand.
- The easing of supply constraints, as more oil production comes online.
