January 4, 2019 / 10:51 AM / 6 months ago

China's Sinopec says losses at trading arm Unipec under audit

BEIJING, Jan 4 (Reuters) - Sinopec on Friday said outside auditors have started reviewing losses at its trading arm Unipec.

Sinopec said in a filing to the Shanghai Stock Exchange that it had found problems with Unipec’s hedging activities and that the trading subsidiary suffered losses due to the decline in crude oil prices.

Sinopec suspended two top Unipec officials and is evaluating details related to certain crude oil transactions that have incurred losses, Reuters reported on Dec. 27.

Unipec President Chen Bo, an industry veteran who helped the company become one of the world’s largest oil traders, has been suspended, along with the senior Communist Party representative at the company, Zhan Qi, Sinopec said in an earlier filing to the Hong Kong stock exchange.

Sinopec’s Shanghai shares have fallen more than 13 percent since Reuters reported the suspension of the two officials.

The benchmark Shanghai composite index has lost 3.4 percent over the same period.

Reporting by Meng Meng and Dominique Patton; Editing by Tom Hogue

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