South Korea’s SK Innovation Turns to Russian Crude

The owner of South Korea’s top refiner SK Energy and petrochemical maker SK Incheon Petrochem, SK Innovation, has been buying oil in Russia and Qatar as a replacement for Iranian condensate, a top official said on Monday, according to Reuters.

“The share of Iranian condensate was high, but that has been replaced with crude oil from Russia, Kazakhstan and Qatar and we also have been diversifying our crude sources,” Choi Nam-kyu, chief executive of SK Incheon Petrochem, told a news conference.

South Korea and other Iranian oil buyers stopped buying oil from Iran after the U.S. government announced an end to sanctions waivers from early May.

SK Innovations executives speaking at a company briefing also forecast an improvement in refining margins in the second half, and said the company was continuing talks on battery joint ventures.

Refining margins would be helped by demand for low-sulphur diesel ahead of the implementation of tougher marine fuel regulations by the International Maritime Organization in 2020, said Suh Sok-won, president of SK Trading International.

“As products are expected to have a lower sulfur content and more gasoil will be produced, I think it’s right to change our feedstock to light crude,” Suh said.