Sinopec Reports 36.8% Net Profit Decline in 2025 Amid New Energy Shift and Weak Margins
China Petroleum & Chemical Corp (Sinopec) reported a 36.8 percent decline in 2025 net profit to 31.8 billion yuan, attributing it to rising new energy substitution and weak petrochemical margins. While gasoline and diesel production and sales fell, kerosene and natural gas output increased. Domestic crude oil output remained stable, with a slight drop expected overseas in 2026. The company also detailed significant capital spending on exploration and development for capacity expansion.
Sinopec, the world's largest oil refiner, announced a substantial 36.8 percent drop in its 2025 net profit, reaching 31.8 billion yuan ($4.62 billion), according to its Shanghai Stock Exchange filing. This decline was primarily driven by increasing substitution from new energy sources and constrained petrochemical margins. Operational figures showed mixed results: gasoline production decreased by 2.4 percent and diesel by 9.1 percent, while kerosene production saw a 7.3 percent increase. Similarly, sales for gasoline and diesel fell, with average prices declining around 7-8 percent. Kerosene sales, however, rose by 4 percent.Domestically, crude oil output marginally increased by 0.7 percent to 255.75 million barrels in 2025, with a stable outlook for 2026. Overseas crude oil output was 26.65 million barrels, expected to drop to 25.31 million barrels in 2026. Natural gas production grew 4 percent to 1,456.6 billion cubic feet and is projected to rise further in 2026. Ethylene production also surged by 13.5 percent.The company's annual refining gross margin improved to 330 yuan per tonne due to better margins on by-products, offsetting high crude import costs. External sales revenue from chemical products, however, dropped 9.6 percent due to lower prices.Sinopec's capital spending in 2025 totaled 147.2 billion yuan, with 70.9 billion allocated to exploration and development. For 2026, planned spending ranges from 131.6 billion to 148.6 billion yuan, focusing on expanding crude oil and natural gas capacity in key regions. The company's Hong Kong-listed shares have seen a modest rise year-to-date but trailed behind peers PetroChina and CNOOC.
