China's biggest oil producer PetroChina tripled its profit in 2017, rebounding on firmer crude prices, the company said, but its shares fell Friday as markets tumbled amid US-China trade tensions. Net profit last year rose to 22.8 billion yuan ($3.6 billion), compared to just 7.86 billion yuan ($1.1 billion) in 2016, the company said in a statement late Thursday to the Hong Kong Stock Exchange, where its shares are listed.
PetroChina, 86 percent owned by its unlisted and government-controlled parent, China National Petroleum Corp (CNPC), also said it was paying a fresh dividend to shareholders of more than 11 billion yuan. Added to a more than 12 billion yuan dividend for the first half announced in August, total shareholder dividends for 2017 were roughly equal to PetroChina's full-year annual profit.
"In 2017, supply and demand fundamentals in the international crude oil market took a turn for the better in general," PetroChina said. "International oil prices moved in a V shape and, taken as a whole, experienced a rise as compared with the last year."
It said an improving global economy and better-than-expected Chinese economic growth also helped fuel growth. Laban Yu, a Hong Kong-based analyst at Jefferies Group, told Bloomberg that PetroChina's profit could have been even better "if not for large asset writedowns" in its petrochemical and pipeline assets. It lost 23.9 billion yuan in 2017 by importing liquefied natural gas to help China weather a shortage caused by a national campaign to replace coal with cleaner energy sources.
It had to sell the imported LNG in the Chinese market below cost. Despite the upbeat earnings, PetroChina shares lost 3.35 percent in Shanghai, where it is also listed, and were 2.71 percent lower in Hong Kong by mid-day Friday as both markets were rocked by the looming threat of a US-China trade war.
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