Two of China’s largest oil and gas companies, PetroChina and China Petroleum & Chemical Corporation, forecast a sharp rebound in net profits for the first half of 2021 on the back of stronger crude oil prices and a broader economic recovery.
China Petroleum & Chemical Corporation, better known as Sinopec, expects a net profit for the first half of 2021 to be in the range of CNY36.5bn (US$5.64bn) and CNY38.5bn. In the same period last year, the company reported a net loss of CNY22.9bn
“Since the beginning of the current year, the global epidemic situation has been improving…international crude oil prices have been on an upward trend,” Sinopec said in a stock exchange filing regarding the reason for the swing into net profits.
The estimated net profit for the company is also better than pre-pandemic levels. In the first half of 2019, the company had reported a net profit of CNY31.3bn.
At 02:30 BST (UTC +1), Sinopec’s shares were trading 1.39% higher than the previous close at CNY4.39 on the Shanghai Stock Exchange. Its shares on the Hong Kong stock exchange (HKEX) were trading 3.05% higher at HK$4.05.
Meanwhile, PetroChina expects net profit for the first half of 2021 to “increase by an amount between” CNY75bn and CNY90bn, which will turn “losses into profits”. In the same period last year, the company had reported a net loss of CNY29.98bn.
In its stock exchange filing, the company said it has been able to “seize the favourable opportunity” of a recovering global economy, increased demand for oil and gas, and higher crude oil prices.
At 02:30 BST (UTC +1), PetroChina’s shares were trading 5.35% higher than the previous close at CNY5.35 on the Shanghai Stock Exchange. Its shares on the HKEX were trading 3.4% higher at HK$3.9.