KUALA LUMPUR, May 26 — Petron Malaysia Refining and Marketing Bhd’s net profit edged up to RM106.38 million in the first quarter (Q1) ended March 31, 2022, from RM103.0 million in the year-ago period.

The better bottom line was due to strong sales, favourable product prices and refining margins as well as efficiency benefits, but the income improvements were partly offset by the temporary provision for mark-to-market commodity hedge losses, the downstream oil and gas company said.

Revenue almost doubled to RM3.8 billion from RM2.0 billion a year ago, it said in a filing with Bursa Malaysia today.

"The country’s continuing efforts to move towards the endemic phase through relaxation of restrictions on business and social activities had revitalised domestic fuel consumption.

"Petron benefitted from the demand recovery with its sales volume for Q1 this year increasing by 13 per cent to 7.7 million barrels compared with 6.8 million barrels in the same period last year,” the company said.

It noted that the price of Dated Brent crude reached an eight-year high average of US$101 (RM444) per barrel in the quarter, up 66 per cent from the same period last year, largely driven by supply concerns caused by the ongoing conflict in Eastern Europe.

On its prospects, Petron said the global oil demand had slowly recovered close to pre-pandemic level, largely driven by the easing of Covid-19 restrictions and reopening of international borders in most countries worldwide despite some short-term headwinds from the reinstatement of strict lockdowns in China. "Meanwhile, the growing list of sanctions imposed on the Russian economy as a result of its ongoing conflict with Ukraine has created tightness in global oil supply, raising prices to historic highs.

"This situation has been further exacerbated by the Organisation of the Petroleum Exporting Countries and its partners’ (OPEC+) shortfall in meeting its committed production hike,” it noted.

On the domestic front, Petron said Malaysia’s economic recovery was expected to regain momentum as the country prepared to enter its endemic phase.

"The resumption of international flights and further easing of travel restrictions in the second quarter are expected to be the significant catalysts for a sustained economic rebound,” it said.

It added that despite the uncertainties posed by the volatility in the oil market and the potential Covid-19 resurgence, Petron remained steadfast, backed by its strong business fundamentals, to navigate this challenging environment towards achieving its commitment to sustainable long-term growth and value to its stakeholders. — Bernama