Saudi Luberef’s profit down on year in Jan-Sept

Market: Oil products
04/11/24

State-controlled Saudi Aramco's base oil subsidiary Luberef posted a significant decrease in profit in January-September as a result of lower margins.

Profit in January-September dropped by 38pc from the previous year to 764mn Saudi riyals ($203mn), although revenue rose by 6.5pc on the year to SR7.4bn. This is because base oil and by-products margins decreased.

Luberef's base oil sales volumes in the first nine months of this year were up 1pc to 929,000t as compared with 918,000t in the same period last year.

Luberef's profit in the third quarter was down by 34pc on the year to SR226mn, against a 2pc on the year drop in revenue to SR2.5bn.

Argus-assessed Asian fob Group I and II base oil export prices were largely lower over the third quarter, especially for light grades, while heavy-grade prices were relatively supported because of tighter supply.

The Yanbu "Growth II" expansion project is expected to completed at the end of 2025, the company said. This will bring the base oil production capacity at the Yanbu facility to around 1.3mn t/y.

Luberef is also studying a project to produce Group III/III+ base oils, which is at the pre-front end engineering design stage.

By Chng Li Li

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