A drying oil such as isomerized linseed oil, dehydrated castor oil or the like oil which has an iodine value of more than 140 and a content of conjugated double bonds of less than 50% is reacted with isopropenylphenol and/or oligomers thereof in an amount, by weight, of 0.1-2 times as great as that of the drying oil in the presence of a small amount of an acid at a temperature of 65-150.degree. C. for 0.5-3 hours. By the reaction, isopropenylphenol and/or its oligomers are introduced to the drying oil while leaving the double bonds of the oil as they are without disappearance. The thus introduced oil is further reacted with a phenol or phenols under strongly acidic conditions to introduce the phenols thereto. The drying oil which has been introduced with the isopropenylphenol and/or its oligomers and also with the phenols is mixed with a phenol or phenols and then reacted with formaldehyde to give a modified phenolic resin. This phenolic resin is useful for making a phenolic laminate with improved flexibility, punching quality and water proof.