Chinese oil giants hit by refining losses

Chinese oil giants Sinopec and Petrochina said they were hit by heavy refining losses in the first quarter, despite strong energy demand and higher oil prices.

Sinopec, Asia's largest refiner, said net profit tumbled 35 percent year-on-year to 13.41 billion yuan ($2.13 billion) for the January-March period, the Hong Kong-listed firm said in a statement late Thursday.

Revenue rose 14 percent to 671.4 billion but the company said its refining division lost 9.2 billion yuan in the first quarter.

"Due to the record high international crude oil price since 2008 financial crisis and domestic tight control over the price of refined products, the refining segment recorded serious operating losses," Sinopec said.

State-owned PetroChina, which is also listed in Hong Kong, said net profit in the first quarter rose 5.8 percent to 39.15 billion yuan, from 37.0 billion yuan a year earlier.

But the firm, which overtook ExxonMobil as the world's biggest publicly-traded producer of oil last month, said its refining business posted an operating loss of 10.82 billion yuan.

Oil prices have traded mostly above $100 a barrel in recent months on worries over ongoing tensions between Western nations and major crude producer Iran while analysts have said China's thirst for oil will likely remain strong.