By Chen Shiyin
Dec. 15 (Bloomberg) -- Singapore Petroleum Co., the only oil refiner traded on the city state’s stock exchange, dropped the most in a month after saying its profit this year will be “severely weakened” amid a slump in crude prices.
The stock fell as much as 6.3 percent to S$2.09, the most since Nov. 13, and traded at S$2.12 as of 9:08 a.m. local time. Earnings have declined because of a “drastic slowdown” in demand for refined products and a “sharp drop” in refining margins, the company said in a statement to the Singapore Exchange on Dec. 12.
Crude oil prices have dropped 68 percent since rising to a record high of $147.27 on July 11. They touched a four-year low of $40.50 on Dec. 5. Singapore Petroleum, which posted a 99 percent drop in third-quarter profit, will release its annual earnings on Jan. 20.
“This is SPC’s first profit warning in recent years,” Goldman Sachs Group Inc. analysts Chris Shiu and Jason Jin said in a report today. “In addition to lower refining margins, we believe inventory losses would also likely contribute to poor fourth-quarter results.”
To contact the reporter on this story: Chen Shiyin in Singapore at schen37@bloomberg.net.
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