Sinopec, China's petroleum and chemical corporation, saw its net profit decline by 6.9% in 2022 due to decreased demand for Chinese fuel resulting from Beijing's measures to control the Covid-19 pandemic, as well as a drop in petrochemical consumption. The largest Asian oil refining company announced in a stock exchange statement on Sunday that its net profit for the previous year was 66.3 billion yuan ($9.65 billion), based on Chinese accounting standards, compared to 71.21 billion yuan ($10.37 billion) in 2021. Sales of chemical fibers plummeted by 18.1%.
Sinopec noted that "due to several factors, the volume of Chinese demand for natural gas, petrochemicals, and refined oil products was weak in 2022." The oil refining company highlighted a four percent growth in diesel fuel sales, thanks to a shift in government policy in late 2022 to promote refined fuel exports.
The company also indicated that crude oil production is expected to reach 250 million tons, or approximately five million barrels per day, without mentioning figures for 2022. It added, "The Chinese economy is expected to recover overall in 2023, which will quickly increase domestic demand for natural gas, refined fuel, and chemicals," stating that global oil prices are likely to remain high due to geopolitical conditions and storage levels.
For 2023, Sinopec plans to produce 280.23 million barrels of crude oil and 12,918 billion cubic feet of natural gas. The strict restrictions imposed by China to control Covid-19 impacted fuel consumption for transportation vehicles, as Sinopec recorded an 11% decline in vehicle fuel sales last year compared to 2021, and an 18.4% decrease in aircraft fuel sales last year compared to 2021.
