Petron braces for income losses

With local pump prices falling much faster than international crude oil prices, Philippine oil refiner and retailer Petron Corp. said it was expecting a net loss of Php1.5 to Php2 billion (US$31.6 to 42 million) in 2008. Petron President Eric Recto said the company’s first income drop in eight years could not be avoided and could be even bigger if international prices continued to fall steeply. “We have the longest inventory cycle among the players here, so it takes us much longer to be able to digest and sell the crude that we purchase,” he said at a news briefing. Petron suffered a 32.2% net income drop in the first three quarters to Php2.78 billion (US$58 million) from Php4.1 billion (US$86.49 million) in the same period in 2007. In the third quarter, Petron saw its profit plummet 67% to Php462 million (US$9.74 million) from Php1.4 billion (US$29.5 million) in the same period in 2007. (December 9, 2008)