China National Petroleum Corporation’s net profit in 2025 was RMB 157.3 billion, with a generous dividend of RMB 86.0 billion.

This newspaper (chinatimes.net.cn) reporter He Yihua Li Weilai Beijing reports

Following China Petroleum & Chemical Corporation (600028.SH) and China National Offshore Oil Corporation (600938.SH) releasing their 2025 annual reports, China National Petroleum Corporation (601857.SH) also officially disclosed its 2025 annual performance report.

In 2025, Brent crude oil prices decreased by 14.6% year-on-year. Affected by this, the performance of the “Three Oil Giants” all declined to varying degrees. Overall, China National Petroleum’s revenue and net profit saw the smallest decline. The financial report shows that during the reporting period, China National Petroleum achieved operating revenue of 2.86 trillion yuan, down 2.50% year-on-year; net profit attributable to the parent was approximately 157.3 billion yuan, down 4.48% year-on-year.

Since the end of February, the outbreak of conflict between the U.S. and Iran has driven international oil prices sharply higher. At the performance release conference held on the afternoon of March 30, China National Petroleum Chairman Dai Houliang stated, “Currently, the company’s operations are generally normal. About 10% of the company’s crude oil and natural gas imports come through the Strait of Hormuz. Therefore, our two major industry chains of oil and gas can ensure long-term, relatively high-load stable operation.”

International oil prices decline

In 2025, the international crude oil market experienced ample supply and demand, with prices fluctuating from high to low and overall trending downward, with the annual average oil price significantly lower than the previous year.

According to monitoring by Jinjianchuang: in 2025, the average annual WTI price was $64.73 per barrel, down $11.03 per barrel, a decline of 14.55%; the average annual Brent price was $68.19 per barrel, down $11.67 per barrel, a decline of 14.62%. The average annual Oman crude oil price was $69.41 per barrel, down $10.18 per barrel, a decline of 12.79%.

Affected by international oil prices, China National Petroleum’s upstream business performed poorly. In 2025, the company’s crude oil production increased by 0.7% year-on-year to 28.6k barrels, with prices declining by 14.2% to $64.11 per barrel, leading to a 14.8% year-on-year decrease in operating profit from oil, gas, and new energy sectors to 136.07B yuan.

Recently, the navigation crisis in the Strait of Hormuz has also drawn market attention to China National Petroleum’s operations. Dai Houliang said that the company’s overall operations are normal, thanks to self-produced oil and gas, imported crude oil and natural gas via pipelines, and overseas shares of oil and gas outside the Middle East, as well as long-term trade contracts, which together account for about 90% of the company’s crude oil processing volume and natural gas sales.

Dai Houliang also admitted that China National Petroleum’s investment activities in the Middle East have been affected to varying degrees. “Last year, we formulated contingency plans to maintain the security and stability of the industrial and supply chains. These are being implemented in an orderly manner and will be continuously tested, revised, and improved in practice.”

As the conflict continues, market analysts believe that international oil prices may find it difficult to return to lows. Jinlianchuang refined oil analyst Bi Mingxin told reporters that in 2026, international crude oil prices are likely to fluctuate at a high level, with the annual median significantly higher than 2025, with geopolitical risk premiums being the core disturbance factor. “If related conflicts with Iran persist through April, international oil prices will continue to rise; if the conflict is effectively resolved, there could be a correction of $10–20 per barrel.”

In 2025, China National Petroleum’s natural gas volume and prices both increased. The natural gas sales business achieved an operating profit of 60.8 billion yuan, with wholesale natural gas gross profit of 53.31 billion yuan, an increase of 6.47 billion yuan year-on-year.

Looking ahead, Gao Yonglu, an analyst at Jinjianchuang, told reporters that overall demand in the domestic market still depends on economic stimulation, but the overall trend is expected to grow. Considering the impact of conflicts, natural gas prices are expected to rise to high levels in the short term. From a long-term perspective, once the Hormuz Strait blockade is lifted, prices may decline. Given international demand tightening, weather, and geopolitical uncertainties, the overall forecast is that domestic natural gas prices will rise year-on-year in 2026.

Chemical profit margins decline

Although the decline in international oil prices led to a decrease in upstream profits, it also reduced the company’s refining costs. In 2025, China National Petroleum’s refining, chemicals, and new materials business achieved an operating profit of 24.25B yuan, up 13.4% year-on-year. Among them, refining business achieved an operating profit of 21.7B yuan, up 19.1%, mainly due to increased unit gross margins in refining.

However, the chemical business performed poorly, with an operating profit of 2.54B yuan, down 19.4% year-on-year, mainly due to loose supply and demand in the chemical market and narrowed gross profit margins for chemical products.

Due to oversupply issues in the chemical industry, “anti-involution” became a frequently used term in 2025. China National Petroleum’s Executive Director and President Ren Lixin responded at the earnings conference, “Overall, the chemical industry is still an incremental market. The main problems are fierce low-end competition and high-end supply shortages, such as some high-end polyolefins and electronic chemicals, which still rely heavily on imports.”

Ren Lixin further stated that China National Petroleum attaches great importance to anti-involution efforts. “Our next goals are to refine oil, strengthen basic organic chemicals, expand new materials, and improve biomanufacturing and fine chemicals, pushing the industry chain toward mid-to-high end.”

This year, the chemical industry also faces some issues. Since late February, the Middle East situation caused international oil prices to surge, pushing up raw material costs for chemicals. Dai Houliang expressed confidence in the resilience of the entire industry chain, noting that in recent years, both China National Petroleum and other domestic companies have seen progress in the chemical sector. “We have raw material advantages and invest in technological innovation, moving toward the mid-to-high end of the industry chain to avoid falling into low-end involution competition.”

Share prices rise for five consecutive years

In addition to impacting operations, recent conflicts in the Middle East have caused significant fluctuations in China National Petroleum’s stock price, with two consecutive days of limit-up setting a record.

During the earnings conference, senior executives also frequently mentioned the company’s stock performance in recent years. Wang Hua, CFO and Secretary of the Board, pointed out that in recent years, the company’s stock price has risen for five consecutive years, and the dividend yield remains high, providing good returns for shareholders.

When listed in 2007, China National Petroleum’s stock price surged, trapping retail investors at the peak, leading to the market joke “How much sorrow can one hold? Just like holding a full position in PetroChina.” Now, the rising stock price has also boosted the confidence of the company’s management.

Dai Houliang admitted that over the past five years, China National Petroleum’s A-shares and H-shares dividends have exceeded 4.5 and 6.2 yuan respectively. The company’s operating performance has been recognized by the capital market, with stock prices increasing significantly—more than tripling for A-shares and more than quadrupling for H-shares. “Long-term investment in China National Petroleum can yield substantial returns. Being a shareholder of China National Petroleum is a happy thing.”

Additionally, China National Petroleum announced its 2025 dividend plan. The board proposed a final dividend of 0.25 yuan per share, with a total payout of 45.76 billion yuan, representing a payout ratio of 54.7% for the year, and a total dividend of 86.02 billion yuan, with a dividend per share of 0.47 yuan.

A securities broker’s investment advisor told reporters, “‘The Three Oil Giants’ are favored by investors in the capital market for their high dividends. Although recent conflicts in the Middle East caused the stocks to hit the daily limit-up for two consecutive days, the stock prices later retreated, mainly due to market concerns that a surge in international oil prices could suppress downstream demand. Additionally, this conflict has prompted countries heavily dependent on imported oil to seek alternative energy sources, indirectly negative for oil.”

Editor: Li Weilai Chief Editor: Zhang Yuning