BEIJING, Oct. 30 (UPI) -- Net profits are expected to decrease significantly if crude oil prices remain low during the fourth quarter, one of China's largest producers warned.
PetroChina, one of the country's top producers and refiners, reported what may be its worst quarter on record, with net income falling nearly 80 percent year-on-year to around $820 million. The company attributed the decline to weak global economic recovery, slow growth in China and low international crude oil prices.
Twin crashes on the Chinese stock market in mid-summer were attributed to lingering weakness. The Chinese government has since intervened by manipulating the value of its currency and slashing interest rates in an effort to slow the decline.
Chinese weakness drags on global demand for energy, pushing crude oil prices lower in an oversupplied market. PetroChina nonetheless said its crude oil production for the first three quarters of the year was up 3.3 percent from last year to 723 million barrels and natural gas production was up 4.3 percent to 2.3 trillion cubic feet.
China National Offshore Oil Corporation, the third-largest company of its kind in China, said Wednesday its revenue for the third quarter was down 32 percent, but production increased by 24 percent.
PetroChina said poor results were largely a reflection of the steep drop in international crude oil prices, which are down about 45 percent from last year.
"If the prices in the fourth quarter of 2015 still remain at a low level, the realized price of crude oil for the company is expected to decrease a lot as compared with the same period last year, and the net profit attributable to equity holders of the company in 2015 is also expected to decrease substantially as compared with last year," it said its statement.