Petron Corporation reported a net income of PHP 1.8 billion in the first quarter of 2026, down 56% from PHP 4 billion in the same period last year, as refinery disruptions and rising global oil prices weighed on its operations.

The company attributed the decline largely to reduced production from its refineries in the Philippines and Malaysia, exacerbated by supply disruptions linked to escalating tensions in the Middle East.

Petron’s Port Dickson Refinery in Malaysia has remained shut down since November 2025 after its product jetty was damaged by Tropical Storm Senyar, while the Petron Bataan Refinery in Limay underwent scheduled maintenance during the quarter.

At the same time, global oil prices surged sharply amidst tightening supply conditions. Benchmark Dubai crude reached USD 129 per barrel in March 2026, nearly double the USD 68 recorded in February. For the first quarter, Dubai crude averaged USD 86 per barrel, up 12% from a year earlier.

Despite the challenging environment, Petron’s revenues rose 27% to PHP 246 billion, driven by higher selling prices. However, operating income fell 36% to PHP 6.1 billion, as margins were squeezed by elevated product costs and reduced refinery output.

Sales volume declined 7% to 25.7 million barrels, down from 27.6 million barrels in the previous year, showcasing the effect of lower production levels.

Petron said it deliberately reduced fuel exports to support the growth of its Philippine retail and commercial segments, prioritizing domestic supply amidst tightening global conditions.

“The geopolitical developments in the Middle East have presented severe supply disruptions in our industry. As we work to manage its impact on our business, our main priority has been to secure adequate fuel supply and make sure we can continue to meet the demand,” said President and CEO of Petron, Ramon S. Ang.

In response to supply risks, the company procured crude and finished products from suppliers outside the Middle East and implemented a crude diversification program that allows its Bataan refinery to process alternative feedstocks.

“We know these are uncertain times, and we are committed to doing everything we can to sustain our operation and keep the economy moving. As the Philippines’ sole remaining oil refiner, we recognize our responsibility to help address the nation’s fuel challenges,” Ang added.

Petron also implemented cost-saving and efficiency measures to manage the impact of higher prices and reduced production.

The company noted that ongoing disruptions to global oil supply chains, along with rising shipping and insurance costs, continue to pose risks to fuel availability and pricing.

How will prolonged global oil disruptions continue to affect fuel prices and supply in the Philippines?

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