SK Innovation, South Korea’s top oil refiner, and Japan-based JX Nippon Oil & Energy have agreed to strengthen their partnership in order to overcome structural challenges faced by the global oil and petrochemical industries, according to the Korean refiner.

Executives from the two companies ― including SK Innovation CEO Chung Chul-khil and JX Nippon Oil & Energy CEO Yasushi Kimura ― discussed joint measures to pursue in line with changing conditions in the global oil market at a high-level meeting held Friday in Tokyo.

During the meeting, the companies forecast prolonged difficulties for Asia’s refining industry, citing volatility in crude prices, increased refining capacities in China and the Middle East and a decline in global demand for oil products.

“Despite high sales recorded in the first half of the year, this is only temporary as structural difficulties are set to stay,” said SK Innovation CEO Chung, calling for cooperation from JX Nippon, which also expressed its consent for more cooperative measures.

During the Friday meeting, SK and JX Nippon also vowed to “accelerate efforts to expand into more global markets” on the back of their successful joint ventures, SK said.

The energy firms currently operate two joint ventures ― Ulsan Aromatics which produces paraxylene and Yubase Manufacturing Asia, which manufactures lubricant oil ― in SK Energy’s Ulsan complex.

Ulsan Aromatics’ paraxylene plant, built in 2014 with roughly 936 billion won ($792 million) in investments, exports 95 percent of its products to overseas market.

Meanwhile, the two firms have been regularly holding meetings and seminars between the heads of management since 2004, in an aim to strengthen their strategic cooperation.

By Sohn Ji-young (jys@heraldcorp.com)