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PetroChina has become the second-largest company in China by market value after it overtook the Industrial and Commercial Bank of China.
Bloomberg reported that the oil major’s stock had soared by 42% since the start of the year, bringing its market value to the equivalent of some $244 billion. The surge was a result of higher oil prices that have lifted energy stocks around the world.
PetroChina had the added advantage of a strong recovery in domestic oil demand, which led to record profits and dividend payouts, contributing to the attractiveness of the stock.
The company earlier this month reported a net income of $22.3 billion (161 billion Chinese yuan) for 2023, up by 8.3% on the year, thanks to recovering domestic consumption of refined petroleum products and a surge in natural gas demand.
Last year, Chinese natural gas and LNG demand rebounded from 2022, when the world’s top LNG importer was still under COVID-related lockdowns that were weighing on household and business consumption of all energy products.
Total revenues for PetroChina, however, slumped by 7% in 2023 compared to 2022, amid lower international oil and gas prices, which affected the upstream earnings. But in terms of company net profit, the downstream business more than offset the impact of the weaker oil and gas prices.
It’s worth noting that while oil and gas prices in 2023 were lower than the three-digit levels seen in 2022, they were still high enough to drive solid profits for oil and gas producers, as evidenced by the strong performance of international majors as well.
CNOOC was also among the big winners on the Chinese stock market, along with China Merchants Energy Shipping Co., with CNOOC seeing a 42% rise in its stock’s value since the start of the year, just like PetroChina.
