PetroChina, China’s largest oil and gas producer, reported a 22 percent increase in net profit for the first half of 2024, driven by higher crude oil prices amid ongoing geopolitical tensions in the Middle East. The company posted a net profit of 103.9 billion yuan (approximately HK$121 billion) for the six months ending June 30, while total revenue rose 5.3 percent to 1.53 trillion yuan, according to its interim financial results released this week.
The Beijing-based firm attributed its earnings boost to a surge in global oil prices, with the average realized crude oil price climbing 15.6 percent year-on-year to US$76.53 per barrel. This price increase helped offset a 2.8 percent decline in total crude output, which fell to 462.9 million barrels during the period. Notably, PetroChina’s overseas production dropped 14.2 percent, reflecting disruptions at Middle Eastern projects amid ongoing regional conflicts, while domestic crude production decreased slightly by 0.5 percent.
PetroChina is in the process of gradually restoring operations at its Middle Eastern assets, with production levels reportedly rebounding to nearly 90 percent of pre-conflict capacity. Ren Lixin, the company’s executive director and president, highlighted the steady resumption of output from these projects during a recent results briefing.
On the domestic front, natural gas production increased 2.4 percent, partially mitigating the impact of weaker oil output. The company’s downstream segments also demonstrated resilience despite a decline in demand for conventional refined fuels. Operating profit from refining, chemicals, and new materials expanded by 31.4 percent to 14.5 billion yuan, while operating profit in the marketing segment surged 50.3 percent to 11.4 billion yuan.
Despite these profit gains, PetroChina’s volume of crude processed decreased by 5.6 percent, and refined product output dropped 8.8 percent. The declines in refined product delivery, coupled with rising oil prices and a gradual shift toward new energy sources, contributed to a 7.3 percent fall in domestic sales of petrol, kerosene, and diesel.
Chief Financial Officer Wang Hua noted that while overall demand for refined fuels may continue to decline in the second half of the year, there are encouraging signs of a market recovery, with expectations that the rate of consumption decline for petrol and diesel will narrow compared with the first half of 2024.
In light of its strong financial performance, PetroChina declared an interim dividend of 26 fen per share.