Prosperity of the petrochemical sector is on the rise-the first half of the performance of the petroleum and chemical sector and outlook (part 1)

Editor's note As of August 31, A-share listed companies' performance reports for the first half of 2021 have been fully disclosed
.

Statistics show that in the first half of the year, there were a total of 502 A-share petroleum and chemical companies, achieving a total operating income of approximately 4.

Editor's note

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In the first half of the year, supported by favorable factors such as economic recovery at home and abroad and sharp rise in international oil prices, the performance of petrochemical companies in Shanghai and Shenzhen stocks was eye-catching.
The net profit growth of the three major sub-sectors of oil and gas exploration, refining, and oil services all doubled.
Domestic energy giants The performance is the best level over the same period in many years
.

Data shows that in the first half of the first half of the petrochemical sector, 50 companies have achieved year-on-year performance growth, and only Hengtai Aipu, Haimo Technology, Zhunyou Co.
, Ltd.
, and ST Renzhi have decreased year-on-year performance
.

Significant improvement in efficiency of energy giants

　Significant improvement in efficiency of　energy giantsSignificant improvement in efficiency of energy giants

In the first half of the year, China coordinated epidemic prevention and control and economic and social development, and effectively implemented macro policies.
The main macro indicators were operating within a reasonable range, and the domestic economy was operating steadily and positively
.

In the first half of the year, GDP grew by 12.

The domestic economy is recovering steadily, coupled with the gradual improvement of the foreign epidemic situation, the energy industry is showing a continuous recovery trend
.

In the first half of the year, the international crude oil market gradually climbed amidst turbulence.

According to the China Petroleum Interim Report, operating income was about 1.
2 trillion yuan, a year-on-year increase of 28.
8%; net profit attributable to the parent company was 53 billion yuan, with an average daily profit of nearly 300 million yuan, and operating performance reached the best level in the same period in seven years
.

The same period last year was a loss of 299.

Sinopec's oil and gas sector has achieved increased reserves, production and efficiency
.

In the first half of the year, the company achieved operating income of 1.

Three major sub-sectors benefited from rising oil prices

　The three major sub-sectors benefited from rising oil pricesThe　three major sub-sectors benefited from rising oil prices

The petrochemical sector is mainly divided into three sub-sectors: oil and gas exploration, oil service, and refining
.

Benefited from the sharp rise in oil prices, the performance of these three sub-sectors has increased significantly

From the perspective of oil and gas production, in the first half of the year, Guanghui Energy, Intercontinental Oil & Gas and New Wave Energy achieved a total of 13.
349 billion yuan in main operating income, a year-on-year increase of 34.
16%; the total net profit attributable to the parent was 1.
767 billion yuan, a year-on-year increase of 202.
56%
.

Among them, Guanghui Energy achieved a net profit of 1.

　　From the perspective of the refining and chemical sector, in the first half of the year, 33 companies including Satellite Petrochemical and Rongsheng Petrochemical achieved a total revenue of 492.
232 billion yuan, a year-on-year increase of 46.
43%; the total net profit attributable to the parent was 52.
319 billion yuan, a substantial increase of 321.
93%
.

The performance growth of the refining and chemical sector is mainly affected by international crude oil prices, the global chemical supply and demand structure has changed, the overall price of chemicals has risen, and downstream demand has improved significantly

　　Another feature of the refining and chemical sector is that due to the positive impact of the operation of the 40 million tons/year integrated refining and chemical project of Zhejiang Petrochemical Co.
, Ltd.
, the shareholding companies have benefited a lot
.
Among them, Tongkun shares achieved revenue of 30.
186 billion yuan in the first half of the year, a year-on-year increase of 41.
43%; net profit was 4.
134 billion yuan, a year-on-year increase of 309.
57%
.
Rongsheng Petrochemical achieved revenue of 84.
416 billion yuan in the first half of the year, a year-on-year increase of 67.
88%; net profit was 6.
566 billion yuan, a year-on-year increase of 104.
69%
.

　　From the perspective of the oil service sector, rising oil prices have increased the capital expenditures of oil giants, and upstream oil service companies have directly benefited
.
In the first half of the year, 16 companies including China National Offshore Oil Services Corporation achieved a total revenue of 104.
77 billion yuan, a year-on-year increase of 7.
21%; the total net profit attributable to the parent was 2.
37 billion yuan, a year-on-year increase of 102.
74%
.

　　The increase in positive factors can be expected in the future

　The increase in　positive factors can be expected in the future

　　Looking forward to the petrochemical sector in the second half of the year, the industry is mostly optimistic
.

　　In the short term, Sinopec expects that domestic demand for refined oil will remain stable, demand for chemical products is expected to maintain a good growth rate, and demand for natural gas will continue to grow rapidly; PetroChina also predicts that domestic refined oil consumption will continue to rebound, and demand for natural gas will maintain rapid growth
.

　　In the long run, under the background of "dual carbon", domestic companies are accelerating the deployment of related businesses, which is expected to increase performance
.
Sinopec said that the company will optimize the terminal network layout and accelerate the construction of the "oil, gas, hydrogen, and electricity service" comprehensive energy station; PetroChina proposes to promote the construction of photovoltaic gas stations, charging and swapping stations, hydrogen refueling stations, and integrated energy service stations
.

　　Industry insiders believe that the performance of the oil giants is a significant signal of the overall recovery of the oil service and refining industries
.
Especially at the moment when oil prices have stabilized at around US$70/barrel, thanks to the rebound in oil demand, oil service and refining companies are getting rid of the industry's haze and entering a rebound cycle as a whole
.

　　In addition, as the Zhejiang Petrochemical Co.
, Ltd.
(Phase II) polyolefin plant enters the countdown to production, Rongsheng Petrochemical and Tongkun will continue to benefit
.
At the same time, the first phase of the high-performance meta-aramid high-efficiency integrated industrialization project for the protection of Taihe New Materials has been officially put into production recently, marking that the company's meta-aramid production is moving towards high-end, and the annual production capacity has been changed from 1,000 tons to Over ten thousand tons
.
These positive factors are expected to drive the performance of the petrochemical sector
.