Sinopec’s refining business suffers loss in 2011

China Petroleum & Chemical Corporation (Sinopec), the largest oil refiner in Asia, said that its refining sector suffered a CNY34.8 billion (US$5.5 billion) loss in 2011 compared to CNY15.9 billion (US$2.5 billion) in the previous year, even as sales grew by 7.6% year-on-year to 151 million tons. To reverse the losses suffered by its refining sector, the company said it may need more upstream expansion, as well as higher fixing of domestic product-oil prices. Sinopec cited the increases in government-mandated domestic product-oil prices, which lagged behind international crude prices last year, as the cause for its huge refining losses. But after the prices of gasoline and diesel were raised by 600 yuan (US$95) per ton on March 20 by the National Development and Reform Commission (NDRC), China’s top economic planner, the company’s profitability looked more promising. (March 27, 2012)