Oil firms shine on price rebound

Analysts expect PetroChina, Sinopec, CNOOC to maintain income growth

Industry analysts predicted the strong rebound of China's oil majors is likely to continue in the second half of the year, after the country's three oil majors - PetroChina, Sinopec and CNOOC - all reported positive half-yearly profits, reaping the benefits of a rebound in crude oil prices.

Total net income among the top three oil majors amounted to 94.17 billion yuan ($13.8 billion) in the first half of the year, 68.1 percent higher year-on-year, with their combined daily net income reaching 516 million yuan.

PetroChina - or China National Petroleum Corp, the country's biggest oil and gas company - saw its net income rise 113.7 percent year-on-year to 27.09 billion yuan, according to a company filing to the Shanghai Stock Exchange.

China National Offshore Oil Corp had earlier reported its best profits since 2015, with net income reaching 25.47 billion yuan, a year-on-year increase of 56.78 percent.

Sinopec - or China Petroleum and Chemical Corp, the world's largest refiner by capacity - reported its best half-yearly profits since listing 18 years ago. Its net income of 41.6 billion yuan in the period was the highest among the three, up 53.55 percent year-on-year.

With crude prices rising, insiders said the companies could soon relive the days when daily net income exceeded 700 million yuan, back in 2013 and 2014.

According to Li Li, energy research director at market consultancy ICIS China, the recovery of crude prices was the biggest driver for the companies' strong performance. She said the oil majors in the country will likely continue to benefit from the price rise in the second half.

The benchmark Brent crude averaged 36.3 percent higher in the first six months at $70.58 a barrel. The West Texas Intermediate averaged $65.52 a barrel, a 31.2 percent increase year-on-year.

Wang Lu, an Asia-Pacific oil and gas analyst at Bloomberg Intelligence, said PetroChina's earnings could continue to improve in the second half, after soaring on triple-digit growth in the first six months.

"Profit increases in the second half will be driven by higher domestic gas prices on the back of the gains in residential city-gate prices on June 10," she said.