What are Singapore refining margins?

What are Singapore refining margins?

Singapore Gross Refining Margins – Asian benchmark – touched new life highs of the $25.9 per barrel mark, on the back of rising demand for refined products globally. This is expected to benefit Reliance Industries, IOCL, BPCL, HPCL, MRPL, and Chennai Petroleum as they process raw crude into refined products.

What is the refinery margin?

Refining margins are the difference in value between the products produced by a refinery and the value of the crude oil used to produce them. Refining margins will thus vary from refinery to refinery and depend on the price and characteristics of the crude used.

How do you calculate refining margins?

For example, if a refinery receives $80 from the sale of the products refined from a barrel of crude oil that costs $70/bbl, then the Refinery Gross Margin is $10/bbl. The Net or Cash Margin is equal to the gross margin minus the operating costs (excluding income taxes, depreciation and financial charges).

What is Singapore GRM?

So far in 2022, Singapore GRMs have jumped over four times. GRM is the amount that refiners earn from turning every barrel of crude oil into refined fuel products. Singapore GRM has so far averaged around the $20 per barrel mark in the Q1FY23 as against $8.1 per barrel in Q4FY22.

How much profit does an oil refinery make?

On a per capita basis, that worked out to an average of $1,660 (though the figure also includes spending by industry, government, and businesses, as well as household and personal spending). And while the Northwest is spending, the oil refineries are raking it in, netting as much as $2 billion in profit each year.

What is a 3 2 1 crack spread?

In other words, a 3-2-1 crack spread is the difference between the cost of three barrels of crude and the sum of two barrels of gasoline plus one barrel of diesel.

Are oil refineries struggling?

Global refining capacity fell in 2021 by 730,000 barrels a day, the first decline in 30 years, according to the International Energy Agency. The number of barrels processed daily slumped to 78 million bpd in April, lowest since May 2021, far below the pre-pandemic average of 82.1 million bpd.

Can refineries make a profit?

Refiners are able to profit from low input costs and sell their refined goods at prices that do not fall as quickly as crude. Specifically, the difference between the monthly average spot price of gas or diesel and the average price of crude oil purchased composes the profit of a refiner.

What is a profitable crack spread?

Refiners’ profits are tied directly to the spread, or difference, between the price of crude oil and the prices of refined products — gasoline and distillates (diesel and jet fuel). This spread is referred to as a crack spread.

Is refinery a good investment?

The Bottom Line Refiners make money when the demand for fuel and value-added petroleum products is high, and they don’t mind when the price for crude goes lower. Both offer a compelling investment opportunity, depending on where the price of crude is.

How much does it cost to set up a refinery?

Planning, designing, permitting and building a new medium-sized refinery is a 5-7 year process with costs ranging from $7-10 billion, not including land acquisition.

How much money do oil refineries make?

In 2018, WRC reports show the industry made $2.0 billion in profit. And in 2019 the industry made $1.8 billion in profit. So from 2017 through 2019, the refining industry profited almost $6 billion.