Profit slump revealed at Jim Ratcliffe-backed Petroineos ahead of major closure
Profitp at Petroineos slumped in the months leading up the closure of its Grangemouth refinery, heavily delayed accounts have revealed, as the energy trading company wrestled with economic uncertainty, supply chain shocks and a shift away from fossil fuels.
The Jersey-based business, which is backed by billionaire Manchester United owner Sir Jim Ratcliffe, posted a pre-tax profit of $82m (£62m) for 2023, a drop of 39 per cent on the previous year, while overall revenues declined 14 per cent to $38.8bn.
“Global oil consumption was hampered by a fragile recovery in China, where oil demand was impacted by increased electric vehicle adoption and a property sector slump,” Petroineos said.
“The geopolitical landscape heavily influenced market dynamics, notably with Russia’s declining crude export prices affecting global supply chains.
“The longer-term energy pressures of the energy transition returned to the foreground, particularly through rising electric vehicle sales and stronger policy pushes for low-emission alternatives.”
Following the reporting period, Petroineos was awarded £2.2m by the High Court over a claim that it brought against oil business Eninco in December last year, in respect of Eninco’s failure to take delivery and pay for fuel oil sales made by Petroineos to the company between 2023-24. Eninco has since entered administration.
Petroineos is majority-controlled by the China National Petroleum Corporation, which is owned by the Chinese government, with the remaining shares controlled by Ratcliffe’s Ineos.
Sir Jim Ratcliffe has previously warned that Europe’s chemicals industry “faces extinction” and called on European Union leaders to ditch their carbon tax and increase tariffs to preserve it.
In an open letter published in February, the founder and owner of chemicals giant Ineos launched an excoriating assessment of the EU’s approach to the chemicals sector, which he said was in crisis.
Petroineos’ Grangemouth refinery closure
The release of Petroineos’ accounts, which were filed several months late, comes just weeks after the company took the decision to suspend refining operations at Grangemouth, Scotland’s only oil refinery, after a century in operation.
The move, which is expected to result in a loss of more than 400 jobs, will see the 1700-acre site transition into becoming an import terminal for finished fuels.
“The Grangemouth business will remain focused on its primary activity of supplying hydrocarbon fuels, mainly to Scotland-based end users, but will purchase these products from markets directly rather than by refining purchased crude oil,” Petroineos said.
Iain Hardie, regional head of legal and external affairs for the company, said: “Petroineos has invested £50m in creating a modern import and distribution terminal capable of receiving finished fuels by sea for onward distribution to customers around the country.
“From today, we will be importing all the products necessary to meet Scotland’s demand for transport fuels.”
About 70 refinery staff will remain to work on the new business.