Petron Corporation, the country’s sole remaining oil refiner, saw its net income tumble by 27 percent in the first half of 2026, hit by geopolitical tension in the Middle East and temporary refinery shutdowns.
In a statement released Tuesday, August 4, the oil firm reported a net profit of ₱3.8 billion for the first six months of the year, down from the same period in 2025. Financial performance was heavily squeezed by record crude prices, elevated import premiums, and surging freight costs.
The company attributed market pressures largely to the ongoing conflict involving the United States and Iran, which sparked severe price fluctuations globally.
Benchmark Dubai crude spiked to $129 per barrel in March before cooling to $79 per barrel in June, averaging $91 per barrel for the first half—a 27 percent increase year-on-year.
Operational hurdles also constrained refining throughput. Production was affected by a temporary closure at the Port Dickson Refinery in Malaysia and scheduled maintenance at the company’s Bataan facility in Limay during the first quarter.
To maintain supply, Petron ran limited refining operations in Malaysia using stocked crude while constructing a replacement jetty expected to be commissioned in early 2027.
Despite these operational bottlenecks, overall sales volume grew six percent to 67.9 million barrels. An 86 percent surge in trading activity by Petron’s Singapore unit helped cushion a six percent drop in combined domestic and Malaysian sales, which came in at 52.9 million barrels. Notably, local retail fuel sales expanded by a robust 15 percent.
Higher fuel prices and volume gains lifted consolidated revenues by 57 percent to ₱605.9 billion. However, high operating expenses and costly raw materials shrank margins, pulling operating income down 17 percent to ₱12.6 billion.
Petron Chairman and Chief Executive Officer Ramon Ang reassured stakeholders that the company remains equipped to secure the country’s fuel needs despite market headwinds.
“While the first half of the year has been challenging, we are confident that our financial discipline, operational resilience, and competitive strengths will enable us to navigate these temporary headwinds,” Ang said.
To boost long-term supply security, Petron is progressing on key projects, including a 180,000-metric-ton annual capacity coco-methyl ester (CME) biofuel facility in Bataan.
The refiner is also building four new storage tanks in Limay set for completion by early 2028, alongside an LPG mounded tank and filling facility in Bacolod slated for late 2028.