Sinopec’s profit falls as high oil prices and COVID curbs weigh

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  • Third-quarter profit down 36% year on year to 13 billion yuan
  • Oil throughput rebounds in Q3, still down 8% YoY
  • The company seeks to reduce its CAPEX 2022 and its investments in the chemical sector

SINGAPORE, Oct 28 (Reuters) – Net profit at major Asian refiner Sinopec Corp (600028.SS) fell 5.6% in the first nine months of 2022, a company filing showed on Friday, dragged down by the weak domestic demand for fuel and strong global oil prices. prices.

Net income totaled 56.66 billion yuan ($7.81 billion) for the January-September period. Revenue rose 23% to 2.45 trillion yuan.

That translates to net profit for the third quarter of 13.13 billion yuan, according to a Reuters calculation based on company filings on Friday, compared with 20.67 billion yuan in the same period last year and the lowest third-quarter profit since 2019.

Sinopec’s refinery crude throughput rebounded in the third quarter from the previous three months, to 59.31 million tonnes, or 4.71 million barrels per day.

However, it was still 8% lower than the same period a year earlier as China’s zero-COVID policy dampened fuel demand and an incident at Sinopec’s Shanghai refinery led to a three-month outage at the 320,000 barrel per day plant.

Sales of refined petroleum products in the country totaled 43.53 million tonnes, up 16% from the previous quarter and about the same level as a year earlier.

“As we enter the fourth quarter, we have seen a recovery in fuel demand and we are optimistic about our sales and refining margins,” said Chen Yang, deputy chief secretary of the board, during the meeting. a conference call on Friday.

Sinopec received 6.5 million tonnes of refined petroleum product exports in the recent batch of quota issuance at the end of September.

When asked if the company plans to fully utilize the quotas by the end of 2022, Chen said Sinopec will prioritize domestic fuel supply and optimize an export plan based on the domestic situation. and abroad.

In oil and gas production, the company produced 210.82 million barrels of crude oil in the first nine months, up 1% year on year. Its natural gas production was 913.81 billion cubic feet, up 4%.

Company officials also said Sinopec was looking to reduce total capital investment and investments in the chemicals sector in 2022 due to tighter cash flow and poor performance in the chemicals sector.

But a final decision depends on board approval.

Sinopec planned 198 billion yuan for 2022 capital investment, and by September it had spent 104 billion yuan.

($1 = 7.2532 Chinese yuan renminbi)

Reporting by Muyu Xu and Chen Aizhu; Editing by Susan Fenton and David Evans

Our standards: The Thomson Reuters Trust Principles.

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