Sinopec first-quarter profit up on sharply on refining improvement

HONG KONG Thu Apr 25, 2013 8:18am EDT

HONG KONG (Reuters) - Sinopec Corp (0386.HK), Asia's largest refiner, posted a 25 percent rise in first-quarter profit as improved refining margins offset lower profits from exploration and production.

The company posted a net profit of 16.7 billion yuan versus 13.4 billion yuan a year earlier, under international accounting standards, the Beijing-based company said on Thursday.

Under Chinese accounting standards, the net totalled 15.8 billion yuan ($2.56 billion) versus 12.8 billion yuan a year earlier.

Chinese oil giants Sinopec and PetroChina (0857.HK), the country's dominant oil and gas producer that also has a refining business, should benefit from China's market-oriented fuel pricing reform, analysts say.

China launched a more flexible system for pricing domestic fuel in March, the first major revamp for four years, to help avoid fuel shortages and tame consumption.

Sinopec and PetroChina had suffered heavy losses in refining as they could not fully pass on higher crude costs to consumers because of government controls on oil product prices.

(Reporting by Charlie Zhu, Raymond Leung and Christina Lo; editing by Jason Neely)

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