China Petroleum & Chemical Corp. (600028), Asia’s biggest refiner, posted a 9.4 percent decline in third- quarter profit, beating estimates, as two increases in retail fuel prices in the period helped margins.
Net Income dropped to 18.3 billion yuan ($2.93 billion) or 0.199 yuan a share, from 20.2 billion yuan or 0.226 yuan a share a year ago, the company, known as Sinopec, said in a statement to the Shanghai stock exchange today. That compares with a median estimate of 14.19 billion yuan in a survey of nine analysts compiled by Bloomberg.
China, which controls retail fuel prices to contain inflation, raised prices twice in August and September after inflation dropped to 1.9 percent in September from as high as 4.5 percent in January. Sinopec, forced to sell fuel below cost under the pricing system, posted its lowest half-yearly profit since 2008 in the six months ended June 30.
“Operations in the third quarter improved thanks to our active adjustments in production and sales,” the company said in the statement. “Prices of chemical products also rebounded in the third quarter after a big decline in the second quarter.”
Crude production rose 2.3 percent in the first nine months to 245 million barrels and natural gas output increased 15 percent to 438 billion cubic feet, according to the statement. Realized crude prices rose 2.5 percent to 100.69 a barrel, while realized natural gas prices rose 5.5 percent to $5.77 per thousand cubic feet, it said. Brent crude, the benchmark for more than half of the world’s oil, averaged $112.20 a barrel in the first nine months, according to data compiled by Bloomberg.
Capital spending reached 83.4 billion yuan in the first nine months, with 35 billion yuan going toward exploration and production, the statement showed.
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