Sinopec Reports H1 2022 Results Amid Weaker Net Profit; Production Rises and Domestic Demand Rebounds
China Petroleum & Chemical Corporation, better known as Sinopec, released its midyear financials showing a net profit of 35.11 billion yuan for the first half of 2022, equivalent to about 4.82 billion USD. The figure marks a 20.1 percent drop from the same period a year earlier, according to the company’s statements filed with the Hong Kong Stock Exchange.
The decline in net profit is attributed mainly to lower global oil prices and softened margins on several refined products. Despite the profit downturn, Sinopec reported a 1.1 percent decrease in operating income to around 218 billion USD and a 19.3 percent reduction in earnings per share for the six months ended June 2022.
On the production side, the company noted improvements in key indicators. Oil refining volumes reached 126.5 million tons, up 4.8 percent from the prior year. Refined product sales, including fuels, climbed 18.5 percent to 116.6 million tons, underscoring ongoing domestic demand strength.
Sinopec linked the performance to China’s post pandemic economic recovery, which has supported higher energy consumption domestically. Natural gas usage rose 6.7 percent year over year, while demand for essential petroleum products such as gasoline, diesel, and kerosene grew by 16.2 percent as the economy reopened and activity picked up.
In terms of upstream activity, Sinopec reported a small gain in crude oil production, increasing by 0.02 percent to 139.68 million barrels in the January to June period of 2022 compared with the previous year. Natural gas output rose more substantially, up 7.6 percent to 18.7 billion cubic meters, reflecting continued emphasis on gas growth as part of China’s energy mix.
Beyond operating results, Sinopec disclosed a plan to repurchase its own shares, with a target range of 100 to 200 million USD. The company’s stock price on the Hong Kong Exchange has risen roughly 14.4 percent since the start of 2022, signaling investor confidence despite the profit slowdown.
Industry observers continue to evaluate the durability of oil as a global energy cornerstone. Questions persist about how long oil will remain the dominant energy source as markets adapt to evolving supply and demand dynamics across North America and other regions. Analysts note that energy demand patterns in major economies, including the United States and Canada, will influence Sinopec and other oil majors in the months ahead.