Caltex shares have hit six month lows after the oil refiner and distributor blamed the falling dollar and a pipeline outage for a predicted cut to first half profit.

Caltex has forecast a net profit of between $160 million and $175 million for the six months to June 30, down from $197 million in the same period last year.

The profit forecast is on a replacement cost basis, which excludes the effect of changes in world oil prices and reflects the company’s underlying performance.

Pre-tax earnings had dropped by about $5 million because of the dollar’s fall, from nearly 104 US cents to 93 US cents in the space of six weeks, and a lag in passing that change on to customers, Caltex said.

Another $6 million earnings hit was due to a pipeline outage at its Kurnell refinery in Sydney in June, the company said.

Caltex shares dropped by $2.42, or 11.8 per cent, to $18.05, their lowest closing price since early December 2012.

But the company said a lower Australian dollar is expected to be more favourable for its refinery business in the long term, improving the difference in price between crude oil and the products produced by the refining process.