Sinopec shifts capital to new energy as China fuel sales fall 8.6%

AI digestMimile.ai EditorialAugust 25, 2026 at 07:30 PM

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Sinopec shifts capital to new energy as China fuel sales fall 8.6%

Sinopec reported a first-half 2026 net profit increase but flagged an 8.6% year-on-year drop in domestic refined oil product consumption. Chairman Hou Qijun said the company will allocate more capital to new energy and chemicals by the end of the decade. The shift comes as gasoline and diesel sales fell 7.9% and 11.5% respectively, while jet fuel rose 1.3%.

Key Facts

Sinopec's domestic refined oil product consumption fell 8.6% year on year in the first half of 2026.
Gasoline sales declined 7.9% and diesel sales fell 11.5% year on year, while jet fuel rose 1.3%.
Sinopec will allocate more capital to new energy and chemicals by the end of the decade, according to Chairman Hou Qijun.
Domestic ethylene equivalent consumption dropped 9.9% year on year in the first half of 2026.
Sinopec's marketing and distribution segment revenues fell 1.5% year on year in the first half of 2026.

Fuel Demand Decline

Sinopec reported an 8.6% year-on-year decline in domestic refined oil product consumption for the first half of 2026. Gasoline consumption decreased by 7.9% and diesel by 11.5%, while jet fuel rose 1.3% driven by holiday travel and international route recovery. Domestic demand for major chemical products was weak, with ethylene equivalent consumption down 9.9% year on year. The marketing and distribution segment saw revenues fall 1.5% year on year, which Sinopec attributed to lower refined oil product sales volume.

Strategic Transformation

Chairman Hou Qijun, appointed a year ago, wrote in a SASAC magazine that Sinopec's ability to respond to market changes is inadequate and 'big company syndrome' remains to be overcome. Hou told analysts on Monday that half of new cars no longer need fuel, questioning how producing more gasoline and diesel can continue to generate revenue. Sinopec plans to develop shale oil fields, sustainable aviation fuels, and cut refining costs to become more resilient to declining fuel demand. The company will allocate more capital to new energy and chemicals by the end of the decade to grow revenues and profits.

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Sinopec shifts capital to new energy as China fuel sales fall 8.6%

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OilPrice

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Sinopec shifts capital to new energy as China fuel sales fall 8.6%

Key Facts

Fuel Demand Decline

Strategic Transformation

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