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Petrojam Limited, the government-owned oil refinery, forecasts volatile oil and natural gas prices for this year. It plans to invest US$15 million in capital projects this year even as energy demand shifts away from heavy fuel oil and towards LNG and renewables.
The refinery processes crude to produce gasolene and other petroleum products.
“Global oil prices are projected to remain volatile in 2025,” Petrojam noted in the newly released Jamaica Public Bodies report for the fiscal year ending March 2026.
The refinery expects crude oil prices to decrease by 6.0 per cent while LNG prices are anticipated to rise by 55 per cent. It estimates that the price of Brent crude will average US$73 per barrel in 2025, down from US$80 per barrel in 2024.
“Risks to these forecasts include geopolitical disruptions and economic slowdowns. In light of the foregoing,” the refinery said. It projects that crude acquisition costs will average US$82.55 per barrel – about US$3 less than the previous year.
Jamaica began transitioning to LNG a decade ago to counter its exposure to oil price volatility and diversify its energy mix. While this shift has resulted in more efficient power plants, both LNG and oil prices have fluctuated over the period, leading to limited reductions in energy costs for consumers. The national power grid, operated by the Jamaica Public Service Company Limited, currently relies on natural gas for two-thirds of the fuel to produce electricity.
Petrojam intends to allocate US$15 million towards upgrades of its facilities.
“This investment is aimed at improving storage capacity to maintain inventory levels sufficient to meet increasing demand,” the Public Bodies report noted.
The spend includes US$6.1 million for an additional asphalt storage tank; US$3.7 million for “sustaining capital activities”; and US$1.3 million for furnace replacement.
The refinery projects that sales of 12.78 million barrels of products, up from 11.26 million barrels in 2024/25. It’s targeting revenue of US$1.26 billion compared to US$1.17 billion the previous year. Efficiency measures and rising revenue are expected to result in forecasted net profit of US$830,000, a turnaround from the US$26.8 million loss recorded a year earlier.
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