The past few months have not been a good look for oil companies worldwide. In the Philippines, the Petron Corporation recently posted a 16% drop in revenue in the first quarter of 2020 compared to the same period the year prior—that’s a P20 billion loss.
Petron attributes the dip in profit to impact of the COVID-19 pandemic on demand and prices, with domestic consumption down due to measures implemented to limit people’s movement. Sales volume for the Philippines and Malaysia sunk to 24.7 million barrels compared to 26.3 million in 2019, and Petron gas stations either closed or shortened their hours in an attempt to lessen the number of vehicles on the road.
“The entire industry is going through a rough phase because of Covid-19’s impact on oil demand and prices,” Petron CEO Ramon Ang said in a statement. “As expected, domestic consumption has gone down particularly in retail and aviation which is understandable because of travel bans and restrictions.”
All in all, the company suffered a net loss of P4.9 billion in Q1 this year compared to a net income of P1.3 billion during the same period in 2019. In response, Petron is implementing “cost-saving and cash conservation measures” which includes the shutdown of its Bataan refinery since May 5. The company, though, assured the public it has enough inventory to meet market requirements.
“Business is challenging. We have to be more prudent in managing our resources while ensuring that the needs of our customers are still met. Demand recovery will depend upon the lifting of quarantine measures and ultimately, finding a vaccine to fully restore mobility,” Ang stressed.
“While we are hopeful for a swift recovery, we know that these are things we cannot rush. The health and safety of the people is still the most important.”