Taiwan's Formosa Petrochemical Corp (6505.TW), one of Asia's largest refined products exporters, plans to cut run rates at its crude distillation units by 40,000 barrels per day (bpd) to 440,000 bpd in June, the company's spokesperson said on Wednesday.
"Due to weak margins, not only for gasoline but also for gasoil, we have to cut runs," said spokesperson K.Y. Lin.
Formosa had originally planned to process 480,000 bpd of crude this month, he said. Last month 440,000 bpd of crude oil was processed, compared with the original plan of 470,000 bpd, he added.
The refiner has kept one of its three naphtha crackers offline and the other two are operating between 70% and 75% of capacity. The company is also substituting 10%-15% naphtha with cheaper alternative feedstock liquefied petroleum gas (LPG) this month.
"Downstream demand for petrochemical is still poor," Lin said.
Profit margins for complex refineries in Singapore, the bellwether for Asian refiners, have been trading below $4 this week after plunging to a one-year low of 90 cents on May 30.
