China Petroleum & Chemical Corp., Asia’s biggest refiner, unexpectedly posted a 6.7 percent increase in first-half profit as a rebound in the nation’s economy spurred demand for oil, gas and petrochemicals.

Net income at Sinopec, as China Petroleum is known, climbed to 35.46 billion yuan ($5.22 billion), or 0.403 yuan a share, from 33.25 billion yuan, or 0.381 yuan, a year earlier, the Beijing-based company said in a statement to the Shanghai stock exchange on Sunday. That compares with a median estimate of 32.4 billion yuan in a survey of 10 analysts compiled by Bloomberg.
Sinopec’s oil-product sales jumped 18 percent by volume, buoyed by an economy that grew 11.1 percent in the first half and surpassed Japan in size. The refiner also benefited from an increase in government-controlled fuel prices in April that helped boost overall revenue by 75 percent during the period.
“The numbers look much better than we previously anticipated as Sinopec took advantage of the demand recovery and higher prices,” said Yin Xiaodong, the Beijing-based chief analyst at Citic Securities Co. “Fuel consumption is expected to keep rising in the second half given the economic growth.”
First-half natural-gas sales surged 33 percent from a year earlier to 4.14 billion cubic meters, Sinopec said. The government raised wholesale gas prices by 25 percent on June 1, the first increase in more than two years, to spur producers to ramp up exploration for the cleaner-burning fuel.
Sinopec declined 7.8 percent in Hong Kong trading in the past 12 months, compared with the 3.2 percent gain in the benchmark Hang Seng Index. The shares dropped 0.2 percent to HK$6.36 on Aug. 20.
(Source: Bloomberg)