Global economic weakness continued to weigh on Saudi petrochemical and refining companies, with many blaming lower product prices for a drop in third quarter profits. Of the 14 companies from the sector trading on the Kingdom’s Tadawul stock exchange, 10 saw 3Q12 profits fall from 3Q11’s levels (see table). Three of Q311’s four loss-makers stayed in the red, while Petro Rabigh managed a turnaround. The refiner made a 3Q12 profit of SR409.3mn ($109mn) on production increases, compared to losses of SR280.6mn ($74.8mn) in 3Q11 and SR104.4mn ($27.8mn) in 2Q12.
The drop in third quarter petrochemical company results helped push the benchmark Tadawul All Share Index (TASI) down to a three month low in October. However, the selling had been overdone, and bargain hunting and some uplift from a climb in crude prices saw petrochemical stocks rally in November. The OPEC basket reached a one-month high of $108.76/B on 19 November. (CONTINUED - 702 WORDS)