Ladies and gentlemen, thank you for standing by. I am Cole, your Chorus Call operator. Welcome and thank you for joining the Tüpraş conference call and live webcast to present and discuss the second quarter 2022 financial results. At this time, I would like to turn the conference over to Mr. Doğan Korkmaz, CFO, and Mr. Levent Bayar, Head of Investor Relations. Mr. Bayar, you may now proceed.
Thank you. Hi, everyone. Good evening to all from Tüpraş headquarters in Istanbul, and welcome to our teleconference. I am Levent Bayar, Head of Investor Relations. I am here with Doğan Korkmaz, CFO, and team members from Tüpraş Investor Relations and Reporting Department. Over the next hour, we will first go over our operational and financial results for the second quarter of 2022. We will continue with the Q&A session. I'll draw your attention to a cautionary statement. During today's presentation, we will make forward-looking statements that refer to our estimates, plans, and expectations. Actual results and outcomes could differ materially. Please refer to our financial reports and material disclosures for more details. These documents are available on our website. In the next two slides, we will provide you with a brief summary of the key highlights regarding the second quarter of 2022.
We will go into detail for each subject on the following slides. Now let's take a look at Tüpraş highlights in detail for the second quarter of 2022. First chart shows that white products have exhibited a strong performance during second quarter and have increased with double-digit rates year-on-year in sales. Jet fuel sales have been improving, now only 12% lower than 2019 levels. Weakness in bitumen sales continued in the second quarter due to lower demand in Turkey while we have been increasing exports of this product within this period. On the second chart, you'll see that our net debt position turned into net cash with strong operational cash flow registered in the second quarter with the help of strong operational cash generation and improved working capital. We ended this quarter with TRY 5.4 million of net cash.
The bottom chart shows our continued solid steps taken for our strategic transition plan. Takeover process of Entek is ongoing, expected to be finalized by the end of the month following the extraordinary general meeting. We have also taken another step for zero carbon electricity to increase our solar power capacity after Batman Refinery. We have initiated the processes on construction and installation of a power plant with 12.6 MW capacity in our Kırıkkale Refinery. For SAF, we have signed an agreement with Honeywell to use their UOP Ecofining technology in our İzmir Refinery. Let's move on to the market section and take a look at the global and domestic developments in the following three slides. As you know, we covered this section in two main components, as developments in global oil market and developments in Turkish market. Let's start with the top left box.
Brent price continued to surge over Russia and Ukraine war amid sanctions on Russia, news flow regarding alternative oil supplies, and SPR releases in the second quarter. Outages weighed during this time, OPET continued to miss its output targets, even including Russian volumes. That had also an impact on Brent prices as well. Brent prices stayed volatile in August, declined to $103 per barrel in the first 15 days of August. News flows regarding Russian oil flow to Europe and recession fears continued to weigh on the sentiment. On the top right, both middle distillate and gasoline inventories were at the lower end of their five-year range in the second quarter of 2022, while supply issues persist despite increasing refinery utilization. Global refining utilization rates were below their last five-year range in the second quarter, while seasonally supportive demand supported cracks.
Now taking a look at the bottom row, Turkish market. Road fuel demand was firm in this period as diesel consumption was at pre-pandemic levels, while gasoline consumption also showed a strong run, increasing by 48% in the two months of this quarter. Jet fuel demand in Turkey, which was up by 63% in the two months of this quarter, remained only 13% below 2019 levels. Right bottom slide shows natural gas price hikes in Turkey that was imposed by BOTAŞ. At the end of the second quarter, industrial tariff prices have reached almost seven times of last year's first quarter level. This chart also excludes additional impact that is coming from BOTAŞ's tiered pricing mechanism.
At Tüpraş, our natural gas expenses increased accordingly and reached TL five billion in the second quarter, which was only TL 800 million in the last year's same quarter. Now let's take a look at the cracks in comparison to the last year's and past five years' second quarter on this page. Slow post-pandemic demand and tightened global supply conditions with Russia-Ukraine war drew down product inventory levels and drove middle distillate cracks to record high levels, especially in June. With similar conditions, gasoline cracks also showed an elevation during this quarter. High sulfur fuel oil cracks remained weak in the second quarter of 2022. Now taking a look at the details.
Diesel cracks were up by $40 per barrel year-over-year and averaged at $45.3 per barrel in the second quarter. Diesel cracks performed way above the historical averages throughout the quarter with firstly improving demand in almost all regions and significant tightening in product inventories following abandonment of Russian-originated ones. In addition to the impact of ongoing war, soaring energy costs also contributed to push up product cracks. In July, diesel cracks slightly softened but kept way above historical averages as global product imbalance persisted. Jet fuel averaged at $44.9 per barrel in the second quarter of 2022, posting a significant increase compared to the last year. Similar to diesel, undersupplied Middle East market has led to extremely high levels in jet fuel cracks in the second quarter.
According to EUROCONTROL data, European air traffic was at 86% by the end of June, versus 2019 levels. The agency now forecasts to see 83% level by the end of this year under its low demand scenario. Average jet fuel cracks were at $31 per barrel in July 2022, in parallel to the trend seen in diesel cracks. Gasoline cracks were up by $24.5 per barrel compared to the last year's same period, and averaged at $35.5 per barrel in the second quarter. A steep upward trend in gasoline cracks supported with elevated passenger car usage and higher feedstock costs in relation to gasoline blending. Average gasoline cracks were realized at $26 per barrel in July 2022.
High sulfur fuel oil cracks averaged around -$29.2 per barrel, and were almost $16 per barrel weaker compared to the second quarter of 2021. This was mainly due to the trend in Brent prices, leading to elevated prices for fuel oils almost globally. Despite relatively stable demand, the increased supply of high sulfur fuel oil as a result of higher refinery utilization weighed on its margins during the second quarter as well. Moving over to the crude price differentials. Heavy crude differentials widened in the second quarter despite Arabian grades becoming more expensive due to elevated demand towards them, as Urals was dismissed by United States and majority of the European players. Meanwhile, some crude types, such as Kirkuk, remained almost flat year-over-year. Urals continued to be offered to the market with deep discounts due to limited demand with self-sanctioning.
On the other hand, discounts are not that wide as they seem on paper due to additional costs such as insurance, logistics, and financing. As a result of these developments, we are now replacing Urals with CPC on this chart as an indicative, being the same region-originated crude type and having similar share in our crude diet in comparison to Urals. We continue to believe the outlook for heavy differentials will remain very hard to predict looking forward. The course of the Russia-Ukraine war, how different countries will be sharing crude oil, potential developments on the other sanctioned producers, and the decisions taken by OPEC+ will continue to be decisive in this regard. Now let's take a look at the Tüpraş operations, starting with the production volume. On the left-hand side, you can see our production volumes.
Our total production in the second quarter of 2022 was 7.1 million tons, 9% higher year-over-year, supported by better demand dynamics and higher capacity utilization. In the second quarter of 2022, our total crude distillation capacity utilization was 93%, and other feedstock capacity utilization was at 7%, reaching 100% for the whole system. Moving over to the sales. Let's start with the chart on the left-hand side. In the second quarter of 2022, our domestic sales and international sales reached 5.7 and 1.6 million tons respectively, summing up to 7.3 million tons in total. Our total jet fuel sales continued to improve and were 18% higher compared to the last year in the second quarter as a result of the improving trend in aviation.
Both diesel and gasoline sales were robust in the second quarter. Diesel sales in the domestic market were firm, with industrial and logistics activity remaining steady. The arrival of the summer season and long holidays in Turkey had a positive impact on gasoline demand as well. Our total bitumen sales were 5% higher year-over-year in the second quarter. However, domestic bitumen sales were lower due to the decrease in bitumen demand in the local market. Now let's move to the financials. Let's take a look at the P&L items in detail for the second quarter of 2022. Revenues almost tripled year-over-year and recorded at TRY 136 billion in the second quarter of 2022. Total product sales were up by 6% in the second quarter versus last year, with sales increasing in all major products.
Average brand price increased in the second quarter by 65% year-over-year, which accompanied by the depreciation in Turkish lira, supported the revenue growth. Costs also almost tripled year-over-year as well, with higher production amounts, higher brand prices, and significant increase in energy expenses. Especially, energy expenses were near seven times of last year's second quarter figure, driven by natural gas tariff hikes and higher production. Gross profits significantly increased to TRY 18 billion, with improvement in cracks, wider differentials, and inventory gains. Material increase in operational expenses was mainly due to logistics expense that was led by Turkish lira depreciation and higher sales. Increase in the general and administrative expenses was mainly due to personnel expenses in parallel to inflationary adjustments. Loss from other operations was at TRY 3.5 billion.
That largely includes the FX loss on trade payables due to Turkish lira's depreciation. Near TL three billion inventory gains largely offset this negative impact, which is recorded under gross profit. The income from equity investments, i.e., OPEC, was recorded at TL 126 million. As a side note, financial income and expenses consists of hard currency balance sheet items, FX gains and losses, and related FX derivative gains and losses, balance of which are offset by the reciprocal inventory gains. As a conclusion of these, we have recorded TL 11 billion of profit before tax in the second quarter of 2022. Below PBT, we have recorded TL 288 million tax expense as an outcome of higher positive deferred tax amount.
We have recorded TRY 10.6 billion of net income in the second quarter of 2022, reaching to historically record level. Now for the EBITDA. Our EBITDA CCS materialized at TRY 13.1 billion. Year-over-year increase was mainly driven by materially better crack margins despite elevated energy expenses. We recorded TRY 2.9 billion of positive inventory effect. This increase was mainly due to Turkish lira depreciation and elevated Brent price. With our hedging methodology, we continue to mitigate the pricing risk of two-thirds of crude oil inventory, which enable us to protect against the high volatility in Brent prices as we've seen in August. Consequently, our reported EBITDA materialized at TRY 16.1 billion, which is materially stronger compared to last year's same period. Now let us take a look at the profit before tax bridge.
As you can see from the chart, increase in crack margins was the most supportive factor for profit before tax in the second quarter of 2022. TRY 15.2 billion contribution was recognized as a result of materially higher year-over-year product cracks. Wider heavy crude differentials and inventory impact originated from higher Brent prices supported profit before tax with TRY 1.5 billion contribution from each. Natural gas costs were the most important factor limiting profitability of this quarter. The increase in natural gas prices had a negative impact of TRY 4.1 billion on the profit before tax year-over-year in the second quarter of 2022. Due to Turkish lira's depreciation and higher interest rates in the second quarter, negative TRY 4.5 billion impact were recognized in the second quarter compared to the same period last year.
There were also other smaller effects amounting to positive TRY 28 million impact on the bridge. All in all, the second quarter of 2022 profit before taxes materialized at TRY 11 billion, which indicates an overall near TRY 10 billion improvement compared to last year's same period. Now let us take a look at the financial highlights. In the second quarter of 2022, we have recorded TRY 16.1 billion of EBITDA, more than 6 times last year's same period. This is largely achieved with strong operational performance. Accordingly, we have recorded TRY 10.6 billion net profit in the second quarter. With strong EBITDA generation and disciplined funding management, we ended the second quarter with a net cash position, and our net debt to EBITDA materialized at negative 0.2x as of the end of the second quarter.
The current ratio is still at 1.1 times, which is in line with the last few years. On the bottom right panel, we have the return on equity. As you can see, our ROE boosted as a result of significant generation of returns. We have recorded 69% return on average equity as of the end of the second quarter. Let's continue with the details of our balance sheet. Cash and cash equivalents and financial liabilities at the end of the second quarter was TRY 37.5 billion and TRY 32.1 billion, respectively. We ended this quarter with TRY 5.4 billion of net cash with strong operational cash generation and improved working capital. On the working capital side, working capital buffer expanded in the second quarter with better collection performance and higher inventory turnover.
While near-term debt looks elevated, we have around 2.2 billion TL of cash, which is sizably over the short-term portion of near $800 million of short-term loans if there's an immediate need. Regarding our FX exposure management, we ended the fourth quarter with $63 million long position. Following the ongoing increase in Brent prices, our inventory amount registered at $2.9 billion in the second quarter of 2022. Hard currency cash position increased quarter-over-quarter, and it is at a strong level with $1.6 billion. We also continue to manage a sizable position of FX assets with forwards. It is also increased quarter-over-quarter to $1.4 billion.
Trade payables continued their upward momentum and reached $5.1 billion, largely due to sharp increase in Brent price, especially towards the period end. On the liabilities side, both our short-term and long-term debt maintained compared to last quarter, totaling to $1.3 billion. We continue to employ strict FX exposure management policies, which targets a square position at period end. Now looking at the maintenance calendar for 2022. We operated with peak utilization in the second quarter since there were no planned maintenances during this period. We are planning to have a similar quarter in the third quarter as well. At the end of the third quarter, we will begin 6-week maintenance in Izmit and nine-week revamp in Izmir. There is no maintenance activity planned for our Kırıkkale refinery in 2022.
On this slide, we have our expectations for 2022. Taking a look at the details, first of all, as you know, we've stopped sharing the expectation for 2022 in Med complex refining margin since it's a theoretical calculation and has lost its indicative quality due to high volatility observed in the oil markets currently. We have increased our Tüpraş net refining margin expectation with stronger cracks and wider differentials. 2022 net refining margin guidance of Tüpraş increased to $13-$14 per barrel, from $8-$9 per barrel earlier with this change. As the main assumption, we expect supply issues of petroleum products due to Russia-Ukraine war will persist during the rest of the year. Regarding the operations, there is no change in our expectations.
We still look for 26-27 million tons of production and 28-29 million tons of sales, while we expect capacity utilization to be within a range of 90%-95%. Our consolidated CapEx target is decreased to $200 million, and we will spend 45% of that budget on sustainability-focused energy efficiency and environmental projects. On this slide, we would like to sum up some key figures for the first half and compare them with our year-end guidance. We had a net refining margin of $13 per barrel in the first half of 2022. Our new guidance range is at $13-$14 per barrel for the whole year. Capacity utilization in the first half was 92%, which is in line with our guidance range of 90%-95%.
In the first half, we have produced 13.8 million tons and sold 13.8 million tons, keeping our existing full year guidance of 26-27 million tons of production and 28-29 million tons of sales. We have spent $59 million in the first half in CapEx. We lowered our CapEx guidance from $300 million to $200 million for the whole year. We have spent about 40% of our CapEx in sustainability-focused investments in the first half of 2022, slightly below our target of 45% for the whole year. Before opening the session for the Q&A, on the next slide, I'd like to give you recent updates of our strategic transition plan, which was announced back in late November 2021.
The second quarter was a period in which we both generated strong profits and made progress in our new investment areas. In line with our long-term strategic plan, we accelerated our steps towards the new investment areas in the second quarter. As you all know, we announced Entek's takeover in April 2022. The transaction is approved by the Capital Markets Board of Turkey in July. We will be having extraordinary general meeting for this takeover in August 2022. We have taken another solid step for zero carbon electricity generation at our Kırıkkale refinery. We signed an agreement for the construction and installation of a solar power plant in Kırıkkale with 12.6 MW of capacity. Our plans on biofuels also continue rapidly. We signed a license agreement with one of the world's leading technology companies, Honeywell, for use of their technology, UOP Ecofining.
Tüpraş will convert approximately 8,300 barrels per day waste into Sustainable Aviation Fuel, Renewable Diesel, and other products this way.