Sinopec’s 2024 net profit plunges 16.8pc due to falling oil prices

BEIJING: China Petroleum & Chemical Corp , known as Sinopec, reported a 16.8 percent decline in 2024 net profit on Sunday, citing lower crude oil prices and the accelerated development of the new energy vehicle (NEV) industry.

The world’s largest oil refiner by capacity posted a net income of 50.3 billion yuan ($6.94 billion), based on Chinese accounting standards, in a Shanghai Stock Exchange filing.

“In 2024, international crude oil prices fluctuated downward, the domestic transportation industry accelerated the replacement of new energy … the gross profit margin was significantly narrowed,” Sinopec said in the filing.

“The company made every effort to expand the market and sales … (and) continues to strengthen cost and expense control, and take multiple measures to cope with market changes.”

The fall in net income compares with a decline of 9.9% in 2023, also on falling oil prices.

The state oil and gas major’s gasoline sales fell 0.7% and diesel sales fell 4.8%. Aviation fuel sales rose 7.3%. The figures included both domestic sales and exports.

Refinery throughput fell 2.14% last year to 252 million metric tons, equivalent to 5.06 million barrels per day. The company forecast a rise to 255 million tons this year.

Sinopec expects its crude oil production in 2025 to be 280.15 million barrels and natural gas output of 1,450.3 billion cubic feet.

The company said it set aside provision for asset impairment of 7.2 billion yuan ($993.3 million) in 2024 due to “market price fluctuations of some products, shutdowns or losses of individual production facilities”.

In Sinopec’s petrochemical business, sales of chemical fibres and plastics were up 19.8%.

Sinopec said it plans capital spending of 164.3 billion yuan this year to cover key investments such as exploration and development.