May 11, 2026 [Reuters]- South Korea’s S-Oil, whose main shareholder is Saudi Aramco, said on Monday it expects second-quarter refining margins ​to remain healthy, as supply disruptions look set to outweigh demand softness driven by high ‌product prices.

In the January-March period, the refiner said it operated the crude distillation units (CDUs) at its 669,000 barrels-per-day (bpd) oil refinery in the southeastern city of Ulsan at 85% of capacity, compared to 96% during full-year 2025.

Here are details of ​S-Oil’s first-quarter results:

• The refiner reported an operating profit of 1.2 trillion won ($817.97 million) in the ​first three months of 2026, compared with a 22 billion won loss a ⁠year earlier, it said in a statement.
• Revenue fell 0.5% on-year to 8.9 trillion won.
• Its refining division ​posted an operating profit of 1 trillion won, helped by wider regional refining margins driven by strong middle ​distillate strength amid run cuts and government-led export restrictions following crude supply disruptions.
• Last month, South Korea capped domestic fuel prices to contain the impact of a spike in energy costs stemming from conflict in the Middle East. Prices are being ​adjusted every two weeks to reflect changes in global oil prices.
• Analysts said South Korean refiners face ​heightened uncertainty due to concerns over crude oil supply disruptions and the implementation of a domestic fuel price cap system.
• They ‌added ⁠that the government’s measures aimed at curbing fuel prices amid the sharp rise in oil prices were resulting in opportunity losses on gasoline sales, weighing on short-term profitability, although the impact is expected to ease once oil prices stabilise.
• S-Oil said on an earnings conference call it was suffering “significant losses” because South ​Korea’s oil price cap system ​had prevented it ⁠from linking domestic fuel prices to international oil prices.
• The company said it was too early to comment on the scale of losses or the timing of ​any compensation, as detailed standards for calculating losses had yet to be ​established.
• S-Oil said any ⁠compensation would be reflected in earnings once the government officially notifies the company of the finalised amount.
• Shares of S-Oil reversed course after rising as much as 4.9% in morning trade following its first-quarter results. Analysts ⁠attributed the ​decline to disappointment that earnings fell short of market expectations ​due to the impact of the oil price cap system. S-Oil shares were down 3.9% as of 0218 GMT, compared with a ​4.5% gain in the benchmark KOSPI.