South Korea's major oil refiners plan to sharply jack up dividend payments to shareholders on the back of their stellar performances last year, industry sources said Tuesday.

According to the sources, SK Innovation Co., the country's top refiner, said earlier it plans to pay a record 596 billion won ($520 million) in dividends for its 2016 fiscal year that ended Dec. 31.

S-Oil Corp., the No. 3 refiner, is also set to deliver a total of 664 billion won in dividends, beating market estimates. But its dividend payment will swell to some 722 billion won when interim dividends already paid are added.

The big dividend payments came as they racked up record earnings last year on the back of improved cracking margins, inventory gains and solid demand for petrochemical products.

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

Industry leader SK Innovation posted a record operating income of 3.23 trillion won last year, with S-Oil also chalking up a record operating income of 1.69 trillion won.

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 have rebounded, hovering above $50 per barrel during the fourth quarter of last year.

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