China oil majors’ profits up on firm demand

SHANGHAI: China’s two big oil giants PetroChina and Sinopec have reported strong third-quarter net profits on robust domestic demand.

State-owned PetroChina said that net profit for July-September was 4.69 billion yuan (US$706.4 million), jumping nearly fourfold from the same period last year.

“International oil prices fluctuated within a wide range and the average price increased significantly compared with the same period last year,” PetroChina said in a statement to the Hong Kong stock exchange, where it is listed.

Sinopec, the world’s biggest oil refiner and the listed unit of stateowned China Petrochemical Corp, said net profit climbed 12.77 per cent year-on-year in the quarter to 11.49 billion yuan.

Sinopec attributed the ‘outstanding results’ to steady Chinese economic growth which fuelled increased domestic consumption of refined oil products and strong demand for gasoline, kerosene, and natural gas.

Analysts said Sinopec’s refining business offset losses in its upstream operations caused by higher oil prices.

“Sinopec’s upstream losses narrowed as oil prices slowly moved up,” Anna Yu, a Hong Kong-based analyst at ICBC International Research, told Bloomberg News.

“Sinopec’s refining business will continue to perform well in the fourth quarter and may register extra inventory gains if oil prices move up.”