Shares in Refining Sector Open Higher on Record Gross Refining Margins

Shares in the oil refining sector opened higher on Thursday after yesterday’s gross refinery margin set record high at USD20.09 per barrel.


The share price of Bangchak Corporation Plc. (SET: BCP) rose THB1.50/share or 4.72% to THB33.25/share, with a trading value of THB332 million.

The share price of Star Petroleum Refining Plc. (SET: SPRC) rose THB0.20/share or 2.00% to THB10.20/share, with a trading value of THB84 million.

The share price of Thai Oil Plc. (SET: TOP) rose THB0.50/share or 0.92% to THB55.00/share, with a trading value of THB663 million.


According to CGS-CIMB Securities Thailand, the rally in oil refining stocks this early Thursday morning was a result of yesterday’s record-breaking gross refinery margin (GRM) of USD20.09 per barrel. Since the beginning of April, GRM has averaged USD18.1/barrel, compared to USD2/barrel in 2Q21.

The increase in refining margins is attributable to rising refined oil prices as a result of the Ukrainian war, which left Russia unable to export oil. Additionally, many countries have reopened their borders, which has led to an increase in demand for oil, particularly jet fuel, as well as a global economic recovery.

As a result of the higher GRM in 2Q22, the refinery sector’s earnings are predicted to expand exponentially. CGS-CIMB recommends a “BUY” rating on TOP and SPRC, with a target price of THB63.50 and THB12.00, respectively.