Chinese Oil Giants Flag Strong Rebound in First-Half Income
Sinopec expects to swing back to profit as the Covid-19 pandemic eases and crude oil prices advance
(Bloomberg) -- Energy giants China Petroleum and Chemical Corp. and PetroChina Co. both forecast a sharp improvement in net income for the first half of 2021 thanks to stronger crude oil prices as the Covid-19 crisis eased and the global economy improved.
In filings Thursday, PetroChina and the company known as Sinopec said the better conditions drove a significant increase in demand for oil, gas and petrochemical products and helped them improve efficiency.
Sinopec expects net income of between 36.5 billion yuan ($5.6 billion) and 38.5 billion yuan for the first half, recovering from a 22.9 billion yuan loss in the same period last year. The forecast is also higher than in the opening half of 2019, when Sinopec reported net income of 31.3 billion yuan.
PetroChina said its earnings will increase by 75 billion to 90 billion yuan in the first half, “turning losses into profit.”
Sinopec’s shares have risen 13% in Hong Kong this year and 7.4% in Shanghai. PetroChina is up 58% in Hong Kong and 26% in Shanghai.
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With assistance from Bloomberg