Low oil prices affect performance of two of China's largest oil companies

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Depressed oil prices in 2016 had their toll on the bottom line of two of China’s top three largest oil companies, which reported slumping revenues and record low profits after what one executive called a “freezing winter of oil prices.”

PetroChina saw its revenue slip 6.3 percent year-on-year to 1.62 trillion yuan (235 billion US dollars), while that of China National Offshore Oil Company (CNOOC) dipped 14.5 percent in 2016 from a year earlier to 146.5 billion yuan (21.26 billion US dollars).

Profits of both companies sank to almost a 10-year low.

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“When you are reading this financial statement, you know our company has walked through the winter of low oil prices for another year,” said Yang Hua, chairman of CNOOC.

The average price of UK Brent crude oil in 2016 was 43.55 dollars per barrel, in comparison with the 52.35 dollars per barrel registered in 2015, a 20 percent decrease.

Sinopec was the only company to register gains, with its net profit climbing by nearly 40 percent to 46.4 billion yuan.

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However, leaders of the oil giants expressed a brighter outlook and expected oil prices will further pick up in 2017.

PetroChina’s Vice President Wang Dong said the company predicts the average oil prices will rise this year, which will help support their operations.