Refiners in South Korea racked up record earnings last year on the back of improved cracking margins, inventory gains and solid demand for petrochemical products, industry data showed on Friday.

The country's four major oil refiners -- SK Innovation Co., GS Caltex Corp., S-Oil Corp. and Hyundai Oilbank Co. -- logged a combined operating income of 8.03 trillion won ($6.96 billion) last year, an all-time high figure.

Industry leader SK Innovation already posted a record operating income of 3.23 trillion won last year, while No. 2 GS Caltex logged an operating income of 2.14 trillion won.

S-Oil also chalked up a record operating income of 1.69 trillion won, with the comparable figure for Hyundai Oilbank being 966 billion won.

"Local refiners enjoyed higher cracking margins on the back of relatively high prices and firm demand," said Yoon Jae-sung, an analyst at Hana Investment & Securities. Their diversified business portfolio also helped improve their bottom line, according to the analyst.

Oil prices have been in the doldrums since 2015 on oversupply concerns, as international sanctions on Iran were lifted allowing the oil-rich country to add new barrels to an already glutted global market and a slump in the global economy sapped demand for oil products.

Crude oil prices, measured by Dubai crude, briefly dropped below $30 a barrel in January 2016, hitting a more than 10-year low. But since the second half of last year, oil prices rebounded, hovering above $50 per barrel during the fourth quarter of last year.

In 2014, major South Korean oil refiners posted their worst-ever performances as a freefall in oil prices hurt the value of their crude inventories amid tight cracking margins.

Their moves to diversify supply chains and beef up facilities that produce high-end products also helped improve earnings, industry watchers said.

SK Innovation notched up more than 1 trillion won in operating income from its petrochemical business, with the portion rising to 54 percent of the total operating income.

S-Oil also enjoyed a hefty rise in its operating income from its petrochemical unit. Its operating income from the business surged 80 percent on-year last year to 517 billion won. (Yonhap)