Petron Corp. said its net income fell 44% to P5.4 billion in the first nine months of 2026, as elevated crude oil prices, import premiums, and freight costs amid geopolitical tensions in the Middle East weighed on its earnings.

The Philippines' sole oil refiner posted a 56% increase in revenue to P928.2 billion for the nine months ended September, driven by higher oil prices and increased sales volume, according to a company statement issued on Tuesday. Despite the stronger top line, Petron said its margins remained under pressure as rising crude costs, import premiums — the added cost of sourcing finished fuel from external suppliers — and freight expenses offset revenue growth.

Chairman and Chief Executive Officer Ramon S. Ang said the company continued to rely on its diversified portfolio, financial discipline, and risk management practices to navigate external challenges.

"Despite external pressures, our commitment to help ensure fuel security, meet the needs of our customers, and fulfill our responsibility as the nation's energy backbone remains strong and unwavering," Mr. Ang said.

Petron's financial statements were unavailable as of press time.

According to the company, benchmark Dubai crude averaged $77 per barrel in July before climbing to $114 per barrel in September, bringing the nine-month average to $92 per barrel, up 29% from a year earlier. Dubai crude is a widely used pricing benchmark for crude feedstock across Asian refineries, making the grade's 29% year-on-year climb a key cost input for Asian refiners such as Petron.

Consolidated sales volume rose 3% to 103.5 million barrels, supported by stronger retail sales in the Philippines and Malaysia, which grew by 16% and 2%, respectively. However, combined sales volume across the two markets declined 3% to 82 million barrels due to lower refinery production, the company said.

Earnings were also affected by weaker refining margins in Malaysia, where operations at the Port Dickson refinery remained constrained by the unavailability of its product jetty, the loading facility used to move finished fuel from the refinery to customers. The original facility was damaged during Tropical Storm Senyar in late 2025, and the company expects to complete construction of a replacement product jetty by the first quarter of 2027. The jetty rebuild, along with the release of the company's full financial statements, will be a key item to monitor as Petron works to bring Malaysian operations back to full capacity.

Petron is the Philippines' only integrated oil refining company, with a domestic market share of 27.8% as of the first half of 2025 — a position that makes its cost pressures and supply performance a key indicator for the country's fuel supply chain. The company operates 50 terminals across the region and about 2,700 service stations, with a combined refining capacity of nearly 270,000 barrels per day.

On Tuesday, Petron shares rose 0.9% to close at P2.23 apiece.

— Sheldeen Joy Talavera, BusinessWorld

Source: BusinessWorld