Stagnant world economy to lower oil prices next year

Stagnant world economy to lower oil prices next year

IRPC’s oil refinery facilities in Rayong’s Muang district. (Photo: IRPC)
IRPC’s oil refinery facilities in Rayong’s Muang district. (Photo: IRPC)

Dubai crude oil reference prices are expected to fall to US$83-85 per barrel next year based on slow global economic growth, says Phichin Aphiwantanaporn, senior executive vice-president of IRPC Plc, the petrochemical arm of national oil and gas conglomerate PTT Plc.

The new average price is slightly lower than the $86-87 per barrel estimated for the fourth quarter of this year, he said.

IRPC’s projection is in the same direction as other oil analysts, who also predict a declining price.

Star Petroleum Refining Plc said earlier global oil prices are likely to decrease for the remainder of this year despite high energy demand, though they remain prone to fluctuations resulting from geopolitical conflicts and economic adjustments in large economies.

The drop in prices is attributed to a surplus among major oil suppliers.

IRPC said it is on track to develop its oil businesses and make use of renewable energy.

The construction of its ultra-clean fuel (UCF) production facility, worth $420 million, is 96% completed and will start operations this year, said Mr Phichin.

The UCF project aligns with the government’s plan requiring oil refineries produce diesel that meets the Euro 5 environmental emission standard, which is scheduled to take effect on Jan 1 next year.

Up to 75,000 barrels of diesel will be produced from the UCF plant daily, he said.

Meanwhile, IRPC is close to completing the installation of floating solar panels valued at 250 million baht and plans to start a trial run at the facility soon, said Mr Phichin.

In the third quarter of 2023, the company’s revenue dropped by 12% year-on-year to 70.7 billion baht. During the first nine months, IRPC earned 224 billion baht, a decrease of 15%, mainly attributed to a dip in oil prices.

Net profit in the third quarter soared by 192% to 2.4 billion baht, up from a loss of 2.5 billion year-on-year. For the first nine months, net profit declined 82% year-on-year to 494 million baht.

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