Sinopec posted record first-half profits as higher global oil and gas prices outweighed a mixed market for fuel in China.
China Petroleum & Chemical Corp., as the firm is officially known, said net income rose 11% to 44.5 billion yuan ($6.5 billion) in the first half of the year, according to an exchange filing. Oil and gas output rose 2.9% and diesel production increased 7.4% despite covid lockdowns in China dampening domestic fuel demand.
The refiner’s capital expenditures rose to 64.7 billion yuan in the first half, compared to 57.9 billion yuan in the same period last year. It’s targeting a massive ramp-up in spending over the second half of the year to 133.4 billion yuan.
The company’s strong first-half results came after fellow state-owned oil giants PetroChina Co. and Cnooc Ltd. saw profits soar on the backs of higher energy prices. Brent crude prices were about 60% higher on average during the first half from the previous year.
The company’s core refining business was hit by pandemic lockdowns, with operating profit falling 24% from the same period last year. China’s oil demand fell to near a two-year low in July.
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