China's biggest refiner state-controlled Sinopec is planning to raise crude throughputs in the second of this year after slumping to a loss of over $3bn in January-June.
Sinopec made a loss of 21.72bn yuan ($3.17bn) in the six-month period, down from a profit of Yn32.2bn in the same period last year, as revenue fell by 31pc to Yn1.03 trillion. But its performance improved sharply in the second quarter following a Yn19.1bn loss in January-March, when China suffered the worst of its Covid-19 outbreak.
The company's refining sector was hardest hit in January-June, with an operating loss of Yn31.7bn compared to a profit of Yn19.1bn a year earlier. Sinopec is targeting crude throughputs of about 5.16mn b/d in the second half of this year, up by 16pc from 4.45mn b/d in January-June. This will take the 2020 average to 4.81mn b/d, or 83pc of its total 5.9mn b/d refining capacity.
The company's domestic crude production was almost unchanged from a year earlier at 682,000 b/d, while natural gas output edged up by 0.6pc to 512.4bn ft³. Overseas crude production declined by 8pc to 89,000 b/d.
Refining margins fell to just $0.24/bl in the first half of 2020 from $7.68/bl a year earlier. Margins hit a negative $3.67/bl in January-March but recovered to $2.94/bl in April-June.
Sinopec is aiming to increase natural gas output to 580.5bn ft³ in the second half of the year but is struggling to meet government expectations of a rise in crude production, with domestic output expected to fall from January-June to 674,000 b/d. The company is aiming to cut its 2020 capital expenditure by around 10pc from its original plan of Yn143.3bn.
Sinopec's first-half performance was better than its nearest Chinese rival PetroChina, which slumped to a loss of Yn29.98bn in the period. But the third-biggest Chinese energy firm, offshore-focused CNOOC, squeezed a Yn10.38bn profit from its upstream listed arm in the first half of this year.
