UPDATE 1-S.Korea March crude imports down 9.8 pct y/y-KNOC

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SEOUL, April 22 (Reuters) - South Korea's crude oil imports in March fell nearly 10 percent from a year earlier as refiners used up their stocks amid soaring crude oil prices, state-run Korea National Oil Corp (KNOC) said on Tuesday.

Reflecting the trend, South Korea's end-March private oil stocks fell 10.7 percent to 65 million barrels, while crude inventory alone fell 35.6 percent to 14.43 million barrels, the lowest since December, KNOC said.

"Refiners processed more crude in March in comparison to their imports, so they had to use up their inventory," said Uhm Kwang-yong, domestic oil products analyst at the state-run oil company.

Crude oil prices were at above $100 a barrel on average in March compared to $50-$60 a barrel range a year ago, prompting refiners to trim back imports.

Crude imports from Saudi Arabia, South Korea's largest crude supplier, rose by 1.3 percent to 22 million barrels (709,677 barrels per day), but imports from Iran and Oman dropped significantly by 25.7 percent and 28.6 percent in March, respectively, KNOC data showed.

IMPROVING MARGINS

"Refining margins in March was better than expected which made refiners run more crude than they had initially planned," Uhm added.

South Korea's four refiners -- SK Energy (096770.KS), GS Caltex, S-Oil Corp (010950.KS) and Hyundai Oilbank -- ran 73.98 million barrels (2.39 million bpd) of crude in March, down 3.1 percent from a year ago but up 8.5 percent from February.

Simple refining margins were at 67 cents a barrel on average in March, up from minus 1.02 a barrel in February. <REF/MARGIN1> Complex margins had also firmed to $8.47 a barrel in March, up by nearly $2.00 from February.

"Cracking margins are in recovery, and most refiners have already been seeking more crude since earlier this month," said a refinery source.

South Korea's top refiner, SK Energy, has increased crude processing rates to 850,000 barrels per day (bpd) from around 780,000 earlier this month, and may raise runs up to 870,000 bpd in May. [ID:nSEO94653] (Reporting by Angela Moon; Editing by Jonathan Thatcher)