BEIJING, March 21 (UPI) -- China's CNPC announced a $5.4 billion loss in 2007.

China National Petroleum Corp., the nation's largest oil producer, said it lost more than $5 billion last year on its oil refining and processing businesses, Xinhua reported.

The company attributed the loss to the gap between high world oil prices and the low state-set domestic price. CNPC also said it was overloaded with demand and there were still supply shortages in parts of the country.

In 2007 CNPC spent more money refining and processing more oil but could not bring in enough revenue to offset the cost of importing the crude oil.

CNPC is the nation's second-largest refiner behind China Petroleum and Chemical Corp., or Sinopec.

PetroChina, CNPC's listed unit, saw its net profit up 2.4 percent from a year ago, but that was not as high as previously estimated.