Idemitsu to boost gasoline, diesel exports in H2 with higher refinery rates

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TOKYO, Nov 10 (Reuters) – Japanese oil refiner Idemitsu Kosan 5019.T expects higher gasoline and diesel exports in the October-March half of its financial year as its run rates are likely to recover to 85%-89% from 70% in the first half, an executive said on Tuesday.

But Idemitsu also expects a weak market for petroleum products in Asia to continue over the six-month period, Munehiro Sekine, general manager of investor relations for Idemitsu, told a news conference.

Idemitsu forecast its annual domestic fuel sales in the year to March 31 to fall 13.1% from a year earlier to 35.26 million kilolitres, hit by collapsed demand from the COVID-19 crisis.

But it predicted that its fuel export will rise 10.5% on year to 4.21 million kilolitres.

“As we expect to boost the run rate to meet higher kerosene demand during the winter, there will be some surplus in other products which we plan to export,” Sekine said, pointing to gasoline and diesel.

“But since the overseas product market has been depressed, we may adjust our run rate if it does not make sense to export our products from an economic rationality point of view,” he said.

Idemitsu’s domestic sales of kerosene is forecast to rise 7.9% this year while its gasoline sales is seen to fall 10%, with jet fuel sales seen tumbling 61.8%.

For the April-September half, gasoline sales slid 14.6% from a year earlier, while jet fuel sales plunged 67.8%.

The company revised down its annual earnings forecast, now predicting a net loss of 20 billion yen, instead of its May estimate of a profit of 5 billion yen, blaming a hefty appraisal loss on its oil inventories due to lower-than-expected oil prices.