January 26, 2026 [Reuters]- South Korea’s S-Oil said on Monday it had logged a 91% surge in fourth-quarter operating profit and expects first-quarter refining margins to remain robust due to steady demand, supply disruptions and the planned closure of a U.S. refinery.

The refiner, which is 63% owned by Saudi Aramco, reported a quarterly operating profit of 424 billion won ($293 million), in line with market expectations. Its refining division’s operating profit climbed 55% to 225.3 billion won.

The refining margin for gasoline from Dubai crude rose to $13.4 dollars per barrel in the final quarter of 2025, compared to $6.5 dollars a year earlier, it said.

Over October-December, S-Oil operated crude distillation units (CDUs) at its 669,000 barrels-per-day (bpd) oil refinery in the southeastern city of Ulsan at 95% of capacity. The rate was 96% for all of 2025.

S-Oil said it plans to shut its No. 2 CDU and No. 2 RFCC in 2026 for scheduled maintenance.

Analysts said the European Union’s sanctions on Russia and Ukraine’s recent drone attacks on Russia restricted Russia’s supply of petroleum products, contributing to a strong refining margin. They expected continued sanctions by the EU in 2026 and attacks by Ukraine on processing facilities will sustain strong refining margins.

The recent crises in Venezuela and Iran are also expected to bring down the competitiveness of China’s processing facilities, which import low-priced crude oil from the nations, according to analysts.

Also, Valero Energy Corporation previously said its unit plans to close refining operations of its Benicia refinery in California, U.S. by end-April 2026.

Meanwhile, S-Oil’s $7 billion project to build a large petrochemical production complex in Ulsan, South Korea, named Shaheen, is targeting mechanical completion in the first half of 2026, the company said.

The project aims to produce up to 3.2 million metric tons of petrochemicals annually from crude oil.