File Photo: cnsphoto

Chinese independent refining giants reported skyrocketing profits in the first half of 2020 with China's easing of coronavirus-related restrictions, in contrast with foreign oil giants that saw quarterly losses amid the pandemic and the downturn in oil demand and prices.   

Rongsheng Petrochemical, an independent refiner, reported Wednesday its operating revenue came to 50.28 billion yuan ($7.24 billion) in the first half of 2020, up 27.32 percent year-on-year. Its net earnings attributable to shareholders skyrocketed 206.55 percent to 3.21 billion yuan.   

The company attributed its results to the PTA (purified terephthalic acid) sector and its holding subsidiary Zhejiang Petroleum & Chemical Co.  

Although falling 26.91 percent from a year earlier, its operating revenue in the PTA sector stood at 7.06 billion yuan, accounting for 14.03 percent of total operating revenue in the first six months, according to the company's financial report. Zhejiang Petroleum & Chemical Co saw its operating revenue hit 27.5 billion yuan with net earnings of 4.49 billion yuan in the period of January to June 2020.

Rongsheng expects its net profits attributable to shareholders to surge by between 197.94 percent and 225.03 percent on a yearly basis to between 5.5 billion and 6 billion yuan in the first three quarters of this year.    

Hengli Petrochemical, a private refiner, said Wednesday its operating revenue had risen 59.11 percent year-on-year to 67.36 billion yuan in the first two quarters. The company reported a surge of 37.2 percent year-on-year in net earnings attributable to shareholders, totaling 5.52 billion yuan.          

High utilization run rates and low-level inventories led the boom, said Hengli, adding that the PTA sector contributed to growth in net earnings.

Analysts said lower oil prices led by the COVID-19 pandemic and economic downturn would benefit downstream companies but would hit oil companies with exploration and development business in upstream industries. 

Although domestic oil giants like China National Petroleum Corp have yet to release their latest financial results, foreign oil companies have reported losses of billions of US dollars.

Exxon Mobil Corp reported a loss of $1.7 billion for the first half of the year, compared with a profit of $5.5 billion a year ago. It announced an estimated loss of $1.1 billion in the second quarter, compared with a profit of $3.1 billion a year ago. 

"The global pandemic and oversupply conditions significantly impacted our second-quarter financial results with lower prices, margins, and sales volumes," said Exxon Chief Executive Darren Woods.

Chevron Corp reported a loss of $8.3 billion in the second quarter, compared with earnings of $4.3 billion in the same period last year. Its US upstream operations reported a loss of $2.1 billion in the second quarter, compared with earnings of $896 million a year earlier.

While demand and commodity prices have shown signs of recovery, they are not back to pre-pandemic levels, and financial results may continue to be depressed into the third quarter 2020, Chevron said. 

Crude prices have stabilized at around $40 a barrel after US oil prices briefly turned negative for the first time in history in April.