Sinopec's half-year profit grew 19.3% on year despite Iran war, falling demand
BEIJING: China’s Sinopec reported an unexpected 19.3% year-on-year increase in net profit for the first half of 2026, despite a litany of issues including the Middle East conflict and falling demand for fuel domestically, but said it had to write down its inventories by 16 billion yuan. Net profit over the January-June period stood at 25.63 billion yuan ($3.81 billion) under Chinese accounting…
China's Sinopec reported a 19.3% increase in net profit for the first half of 2026, defying challenges including the Middle East conflict and falling domestic demand. The company's net profit for January-June reached 25.63 billion yuan ($3.81 billion), up from 21.48 billion yuan the previous year, according to a filing at the Shanghai stock exchange.
Sinopec, the world's largest refiner, nonetheless had to write down 16 billion yuan in inventories due to oil and fuel price volatility. The company relies on the Middle East for half of its crude oil needs, making it vulnerable to the supply crisis caused by the closure of the Strait of Hormuz. However, Sinopec managed to increase its refining margin by 44.1% year-on-year, reaching 453 yuan per metric ton.
The company also broadened its crude oil sourcing outside the Middle East and optimized its product mix based on profitability. Despite these efforts, Sinopec's chemicals segment remained loss-making, with an operating loss narrowing by around 4 billion yuan.
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