Oil gi­ant PetroChina Q1 net profit plunges 82%; blames global oil price fall

The China Post - - WORLD BUSINESS -

Chi­nese en­ergy gi­ant PetroChina said its net profit plunged 82 per­cent year-on-year in the first three months of the year, blam­ing the plunge in in­ter­na­tional oil prices.

Net profit came in at 6.15 bil­lion yuan (US$1.01 bil­lion) in the first quar­ter, down from 34.25 bil­lion yuan for the same pe­riod in 2014, the com­pany said late Mon­day in a state­ment to the Hong Kong stock ex­change, where it is listed.

“In the first quar­ter of 2015, the world econ­omy re­cov­ered slowly and geopol­i­tics con­tin­ued to be tur­bu­lent,” the com­pany said, adding China’s eco­nomic growth slowed for the pe­riod.

China’s econ­omy ex­panded 7.0 per­cent year-on-year in the first three months of 2015, the worst show­ing for a sin­gle quar­ter since the first three months of 2009. It ex­panded 7.4 per­cent for all of last year, the slow­est pace in nearly a quar­ter of a cen­tury.

“In­ter­na­tional crude

oil

prices have sig­nif­i­cantly de­clined since the sec­ond half of 2014 and fluc­tu­ated at a low level in the first quar­ter of 2015,” PetroChina Chair­man Zhou Jip­ing said in the state­ment.

The price of a bar­rel of oil has al­most halved since June ow­ing to a surge in sup­plies and a slump in de­mand.

Turnover of PetroChina slumped 22.4 per­cent year- on- year to 410.34 bil­lion yuan in the first quar­ter, ac­cord­ing to the state­ment.

PetroChina, the listed arm of China Na­tional Petroleum Corp. (CNPC), is­sued a warn­ing for first half earn­ings, say­ing the com­pany ex­pects its net profit to de­crease sub­stan­tially if oil prices re­main low.

On Tues­day af­ter­noon, shares in the firm were down 5.45 per­cent in Hong Kong and 1.77 per­cent lower in Shang­hai, where it is also listed.

Separately, PetroChina has de­nied the Chi­nese gov­ern­ment is work­ing on form­ing an oil gi­ant by merg­ing its par­ent CNPC with an­other oil firm, Sinopec, ac­cord­ing to a state­ment.

The of­fi­cial Xin­hua news agency said Mon­day that China is con­sid­er­ing merg­ing scores of its big­gest state-owned en­ter­prises to cre­ate around 40 na­tional cham­pi­ons from the ex­ist­ing 112 through merg­ers and ac­qui­si­tions.

Me­dia re­ports about the pos­si­ble move sent the stock prices of PetroChina and Sinopec up sharply on Mon­day.

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