Sinopec 2023 profit falls 13% on oil prices, refining record

SINOPEC’S annual profits declined 13 per cent, after oil prices fell and Chinese refiners posted a record year for processing and imports.

China’s largest fuel processor, officially known as China Petroleum & Chemical, reported 58.3 billion yuan (S$11 billion) net income for last year in an exchange filing. That compared with 66.2 billion yuan in 2022. 

Global oil prices were 17 per cent lower in 2023 than the previous year, which reduced the value of Sinopec’s drilling output but also lowered its crude costs. 

Chinese refiners ramped up fuel production last year to feed a populace eager to travel after Covid-19 restrictions were lifted. Still, the company had to grapple with a tepid economic recovery that created a glut of some chemicals such as ethylene. 

The increase in refining activity also boosted China’s oil imports to a record. The nation’s refiners benefited in particular from cheap Russian crude shunned by many nations after the country’s invasion of Ukraine.  BLOOMBERG