It was learned from reliable sources that the Sinopec parent company, Sinopec Group, is likely to have received approval from the government for financial subsidies for the refining sector. The number of specific subsidies was not revealed before.
Subsidy distribution According to industry sources, the parent company does not need to make an announcement for subsidy, and how much of it will be the key to the issue. Sinopec has already acquired almost all of its refining assets from its parent company.
Before this, in 2005 and 2006, Sinopec Group and Sinopec respectively received state financial subsidies. As the Group's major refining assets are all listed companies, the listed companies receive much more subsidies than Sinopec Group.
Based on past operating experience, Shanghai Petrochemical has subsidized some subsidies from Sinopec Corp.'s subsidies based on refining capacity.
Sinopec Group and Sinopec did not respond to the news.
Sinopec sources said that it has not yet been informed whether the group has received subsidies. If the future group’s subsidies for listed companies are determined, an announcement will be issued in a timely manner.
Refining losses Due to the sharp increase in international crude oil prices since the second half of last year, and refined oil prices have not yet liberalized, Sinopec has experienced heavy losses in the refining sector in the third quarter.
Industry sources pointed out that the NDRC raised the price of refined oil products in the fourth quarter, but the soaring price of crude oil has caused Sinopec's refining business to continue to lose money. Calculated at US$80 per barrel, a refinery will lose about 1,000 yuan for each ton of refined oil produced.
According to the company’s 2007 unaudited production and operation data, a total of 156 million tons of crude oil were processed last year, an increase of 6.33% year-on-year. The output of gasoline, diesel, kerosene, and chemical light oil was 24.69 million tons, 60.08 million tons, 8.32 million tons, and 23.47 million tons, respectively, which was 7.35%, 3.84%, 31.02%, and 3.21% higher than that in 2006, respectively.
In 2007, Sinopec’s domestic total sales volume of refined oil products reached 119 million tons, a year-on-year increase of 6.9%, of which retail volume was 76.62 million tons, a year-on-year increase of 6.18%. These figures were all higher than the company’s annual targets set at the beginning of last year.
The domestic policy losses not only appear in the refining sector, but also in the import of refined oil. At the end of last year, there was a large area of ​​“oil shortage†in the southern oil supply. To ease the tension, Sinopec and PetroChina imported a large amount of refined oil. Sinopec Corp. imported 60,000 tons of gasoline in September, imported 90,000 tons of diesel in October, imported 287,000 tons of diesel in November, and imported 423,000 tons of diesel in December, and basically stopped exports of gasoline and diesel from the second half of the year. In the case of “upside down†prices of refined oil products at home and abroad, large losses were incurred.
"Basically, the refinery is already at full capacity, and Sinopec has done a lot of work to ensure the supply of domestic oil products," said a person from Sinopec.
Subsidy distribution According to industry sources, the parent company does not need to make an announcement for subsidy, and how much of it will be the key to the issue. Sinopec has already acquired almost all of its refining assets from its parent company.
Before this, in 2005 and 2006, Sinopec Group and Sinopec respectively received state financial subsidies. As the Group's major refining assets are all listed companies, the listed companies receive much more subsidies than Sinopec Group.
Based on past operating experience, Shanghai Petrochemical has subsidized some subsidies from Sinopec Corp.'s subsidies based on refining capacity.
Sinopec Group and Sinopec did not respond to the news.
Sinopec sources said that it has not yet been informed whether the group has received subsidies. If the future group’s subsidies for listed companies are determined, an announcement will be issued in a timely manner.
Refining losses Due to the sharp increase in international crude oil prices since the second half of last year, and refined oil prices have not yet liberalized, Sinopec has experienced heavy losses in the refining sector in the third quarter.
Industry sources pointed out that the NDRC raised the price of refined oil products in the fourth quarter, but the soaring price of crude oil has caused Sinopec's refining business to continue to lose money. Calculated at US$80 per barrel, a refinery will lose about 1,000 yuan for each ton of refined oil produced.
According to the company’s 2007 unaudited production and operation data, a total of 156 million tons of crude oil were processed last year, an increase of 6.33% year-on-year. The output of gasoline, diesel, kerosene, and chemical light oil was 24.69 million tons, 60.08 million tons, 8.32 million tons, and 23.47 million tons, respectively, which was 7.35%, 3.84%, 31.02%, and 3.21% higher than that in 2006, respectively.
In 2007, Sinopec’s domestic total sales volume of refined oil products reached 119 million tons, a year-on-year increase of 6.9%, of which retail volume was 76.62 million tons, a year-on-year increase of 6.18%. These figures were all higher than the company’s annual targets set at the beginning of last year.
The domestic policy losses not only appear in the refining sector, but also in the import of refined oil. At the end of last year, there was a large area of ​​“oil shortage†in the southern oil supply. To ease the tension, Sinopec and PetroChina imported a large amount of refined oil. Sinopec Corp. imported 60,000 tons of gasoline in September, imported 90,000 tons of diesel in October, imported 287,000 tons of diesel in November, and imported 423,000 tons of diesel in December, and basically stopped exports of gasoline and diesel from the second half of the year. In the case of “upside down†prices of refined oil products at home and abroad, large losses were incurred.
"Basically, the refinery is already at full capacity, and Sinopec has done a lot of work to ensure the supply of domestic oil products," said a person from Sinopec.