Aug. 28 (UPI) -- Chinese oil and gas company Sinopec said net profit for the first half of the year was up 40 percent in response to domestic demand and higher crude oil prices.
The company, known formally as China Petroleum & Chemical, reported a net profit for the first six months of the year at $4.2 billion, up 40 percent from the same period last year. Net cash flow was down about three quarters of a percent, while operating income was up 30 percent from last year.
Globally, Sinopec said the economy experienced only moderate growth, while China maintained a steady rate with gross domestic product up by 6.9 percent year-on-year. The price for Brent crude oil, the global benchmark for the price of oil, is about 3.5 percent lower than where it started the year, though the company said the first-half average price was up 30.4 percent from the same period in 2016.
Russia is China's top crude oil supplier and July exports of 8.2 million barrels per day were 11.8 percent higher than the previous year. A report sent last week from JBC Energy Market found Chinese oil imports grew about 12 percent from last year.
Asian economies are expanding faster than many of their Western counterparts and supply and demand figures can have a pronounced impact on energy markets.
"Domestic consumption of refined oil products increased by 5.5 percent compared with the first half of 2016, among which gasoline and kerosene consumption maintained strong growth momentum, and diesel consumption reversed its downward trend and realized growth year on year," Sinopec declared in its financial statement. "Domestic demand for natural gas accelerated, up by 15.2 percent compared with the first half of 2016."
Looking ahead, Sinopec said it expected steady growth in the Chinese economy will drive demand in refined oil products, but natural gas demand would be "robust" as the nation's economy shifts toward cleaner energy resources.
Refinery throughput, the capacity for refining crude oil, increased 1.6 percent from last year. Crude oil production for Sinopec was down 5.3 percent while natural gas production grew 16.3 percent.
"For the second half of 2017, the international crude oil prices are expected to fluctuate at a low level," the company added.