Sinopec 2025 Crude Oil Production Rises

By Ed Ballard

Shares in Chinese energy companies dropped after the U.S. ouster of Venezuela's president raised concerns about their access to oil supplies.

China is the largest importer of Venezuelan oil. President Trump said these exports will continue-under U.S. auspices-but investors in state-controlled Chinese oil companies seem to have doubts.

• Hong Kong-listed shares of Cnooc and PetroChina shed 3.3% and 3.5%, respectively.
• Shares in Sinopec, or China Petroleum & Chemical, fell 1.9%.
• In contrast, shares of U.S. refiners jumped premarket on the expectation that more Venezuelan crude will head their way.

Chinese companies will weather the potential loss of access to Venezuelan oil, said Michal Meidan, director of the China energy program at the Oxford Institute for Energy Studies.

The roughly 300,000 barrels a day they imported in the past couple of years are a fraction of total imports of 11.3 million barrels a day, Meidan wrote in a LinkedIn post.

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By Kimberley Kao

Chinese oil stocks weakened after the U.S. ousted Venezuelan President Nicolás Maduro over the weekend, raising concerns it could limit China's access to oil.

"Small and large Chinese refineries have for while been buying deeply discounted oil" from Venezuela which has faced U.S. sanctions, said Ole Hansen, head of commodity strategy at Saxo.

Any potential sanctions relief would mean that China will have to either pay market rates, which will erode profits, or source their crude elsewhere, Hansen said.

Although Venezuela is a relatively small supplier of China's oil imports, Vishnu Varathan, managing director at Mizuho Securities said: "Denying China access to Venezuelan oil has accentuates China's energy-shipping risks."

He noted that all other Chinese crude imports have to pass through shipping lanes that could be potential choke points, such as the Straits of Malacca.

"China's oil stocks are underperforming today largely due to sentiment and structural concerns, rather than any single headline risk," said Priyanka Sachdeva, senior market analyst at Phillip Nova.

Hong Kong-listed shares of Cnooc and Sinopec were down 3.5% and 2.1% respectively. PetroChina fell 3.3%.

Oil markets are expected to be in surplus this year, and Venezuelan supply could pressure prices lower, "even as there is uncertainty around whether and how quickly Venezuela may be able to ramp up oil production and also regime stability," said Michael Wan, senior currency analyst at MUFG.

This supply backdrop, coupled with soft Chinese oil demand, weighs more on Chinese oil equities compared to Japan and South Korea, "where energy companies tend to have stronger balance sheets, better downstream integration, and less exposure to domestic margin pressures," Phillip Nova's Sachdeva said.

Energy stocks in other Asian markets were broadly higher.

Japan Petroleum Exploration ended 0.4% higher in Tokyo, after jumping as much as 3.0%. South Korea oil refiners SK Innovation and S-Oil rose 2.8% and 5.35%, respectively.

Oil futures were trading in a tight range on Monday, swinging between gains and losses.

The Venezuela crisis is unlikely to move the needle for oil prices, because "after years of sanctions and neglect to its oil infrastructure, Venezuela is no longer a major oil producer," said UOB Global Economics & Markets Research team in a note.

"Venezuela may drive short-term caution, but it doesn't alter the market's core belief that ample supply and subdued demand will cap upside for oil prices into 2026," Phillip Nova's Sachdeva said.

Write to Kimberley Kao at kimberley.kao@wsj.com

By Kimberley Kao

Chinese oil stocks weakened after the U.S. ousted Venezuelan President Nicolás Maduro over the weekend, raising concerns it could limit China's access to oil.

A cut in Venezuelan sales to China could be more significant than on the U.S. as Venezuelan crude makes up about 5%-8% of China's total imports, compared to 1%-2% for the U.S., Lim Sin Kiat, analyst at Kenanga Investment Bank said in a note. "A total shutdown might affect China more, especially the refineries," Lim said.

Also, the type of crude Venezuela produces is thicker than most oil consumed on the global market, and in China can wring more profit out of it than other grades of crude, making it highly attractive for fuel makers.

Although Venezuela is a relatively small supplier of China's oil imports, Vishnu Varathan, managing director at Mizuho Securities said: "Denying China access to Venezuelan oil has accentuates China's energy-shipping risks."

He noted that all other Chinese crude imports have to pass through shipping lanes that could be potential choke points, such as the Straits of Malacca.

Hong Kong-listed shares of Cnooc and Sinopec were down 4.0% and 1.5% respectively. PetroChina fell 4.5%.

"The initial implications for Asia's markets probably include a bias for oil prices to head lower over time, which could be positive at the margin for larger oil importers in Asia," said Michael Wan, senior currency analyst at MUFG.

Oil markets are expected to be in surplus this year, and Venezuelan supply could pressure prices lower, "even as there is uncertainty around whether and how quickly Venezuela may be able to ramp up oil production and also regime stability," Wan added.

The Venezuela crisis is unlikely to move the needle for oil prices, because "after years of sanctions and neglect to its oil infrastructure, Venezuela is no longer a major oil producer," said UOB Global Economics & Markets Research team in a note.

Energy stocks in other Asian markets were broadly higher.

Inpex and Japan Petroleum Exploration were 1.6% and 2.3% higher respectively in Tokyo. South Korea oil refiners SK Innovation and S-Oil rose 2.4% and 6.2%, respectively.

Oil futures were trading in a tight range on Monday, swinging between gains and losses.

Write to Kimberley Kao at kimberley.kao@wsj.com

By Kimberley Kao

Chinese oil stocks weakened after the U.S. ousted Venezuelan President Nicolás Maduro over the weekend, raising concerns it could limit China's access to oil.

A cut in Venezuelan sales to China could be more significant than on the U.S. as Venezuelan crude makes up about 5%-8% of China's total imports, compared to 1%-2% for the U.S., Lim Sin Kiat, analyst at Kenanga Investment Bank said in a note. "A total shutdown might affect China more, especially the refineries," Lim said.

Also, the type of crude Venezuela produces is thicker than most oil consumed on the global market, and in China can wring more profit out of it than other grades of crude, making it highly attractive for fuel makers.

Although Venezuela is a relatively small supplier of China's oil imports, Vishnu Varathan, managing director at Mizuho Securities said: "Denying China access to Venezuelan oil has accentuates China's energy-shipping risks."

He noted that all other Chinese crude imports have to pass through shipping lanes that could be potential choke points, such as the Straits of Malacca.

Hong Kong-listed shares of Cnooc and Sinopec were down 4.0% and 1.5% respectively. PetroChina fell 4.5%.

"The initial implications for Asia's markets probably include a bias for oil prices to head lower over time, which could be positive at the margin for larger oil importers in Asia," said Michael Wan, senior currency analyst at MUFG.

Oil markets are expected to be in surplus this year, and Venezuelan supply could pressure prices lower, "even as there is uncertainty around whether and how quickly Venezuela may be able to ramp up oil production and also regime stability," Wan added.

The Venezuela crisis is unlikely to move the needle for oil prices, because "after years of sanctions and neglect to its oil infrastructure, Venezuela is no longer a major oil producer," said UOB Global Economics & Markets Research team in a note.

Energy stocks in other Asian markets were broadly higher.

Inpex and Japan Petroleum Exploration were 1.6% and 2.3% higher respectively in Tokyo. South Korea oil refiners SK Innovation and S-Oil rose 2.4% and 6.2%, respectively.

Oil futures were trading in a tight range on Monday, swinging between gains and losses.

Write to Kimberley Kao at kimberley.kao@wsj.com

                                Close      Prior     Change   % Change 
                                -----      -----     ------   -------- 
 Air China A                     8.73       8.73      -0.06      -0.68 
 Anhui Conch Cement A           23.71      23.71      +0.12      +0.51 
 Bank of China                   5.68       5.68      +0.02      +0.35 
 Baoshan Iron & Steel A          7.64       7.64      +0.03      +0.39 
 Bright Dairy & Food A           8.72       8.72      +0.19      +2.23 
 China Eastern Airlines A        5.29       5.29      +0.03      +0.57 
 China Merchants Bank           42.96      42.96      +0.24      +0.56 
 China Minsheng Banking A        4.04       4.04       unch       unch 
 Chn Petro & Chem Sinopec        5.67       5.67      +0.01      +0.18 
 China Southern Airlines         7.29       7.29      +0.05      +0.69 
 China United Ntwk Comms         5.50       5.50      -0.03      -0.54 
 China Yangtze Power A          28.62      28.62      +0.09      +0.32 
 Chongqing Brewery A            54.35      54.35      +0.35      +0.65 
 CITIC Securities A             29.06      29.06      -0.24      -0.82 
 COSCO SHIPPING Engy A          12.41      12.41       unch       unch 
 COSCO SHIPPING Special A        7.49       7.49      +0.08      +1.08 
 Daqin Railway                   5.73       5.73      -0.01      -0.17 
 Dongfeng Automobile A           7.85       7.85      +0.08      +1.03 
 Fujian Yanjing Huiquan         12.06      12.06      +0.09      +0.75 
 Haier Smart Home A             26.88      26.88      -0.22      -0.81 
 Hainan Airlines Hldg A          1.83       1.83      -0.01      -0.54 
 Hisense Visual Tech A          25.50      25.50      +0.02      +0.08 
 Hua Xia Bank A                  6.99       6.99       unch       unch 
 Huadian Power Intl              5.47       5.47      -0.07      -1.26 
 Huaneng Pwr Intl                8.19       8.19      -0.08      -0.97 
 INESA Intelligent Tech A       19.19      19.19      -0.08      -0.42 
 Jiangsu Expressway A           13.81      13.81      -0.09      -0.65 
 Jiangxi Copper A               39.27      39.27      -0.98      -2.43 
 Lucky Film A                    7.78       7.78      +0.06      +0.78 
 Maanshan Iron & Steel A         4.37       4.37      +0.34      +8.44 
 Nanjing Iron & Steel A          5.49       5.49      +0.01      +0.18 
 SAIC Motor A                   15.90      15.90      -0.18      -1.12 
 Shandong Gold-Mining A         36.10      36.10      -0.31      -0.85 
 Shanghai Bailian Group A        9.26       9.26      +0.09      +0.98 
 Shanghai Pudong Dev Bank       11.67      11.67      -0.02      -0.17 
 Shanghai Xinhua Media A         6.89       6.89      -0.04      -0.58 
 Shenyang Jinbei Auto A          5.00       5.00      +0.05      +1.01 
 Sichuan Changhong Elec A       10.04      10.04      -0.11      -1.08 
 SINOPEC Oilfield Svc A          2.35       2.35      +0.02      +0.86 
 SINOPEC Shanghai PetroChm       2.83       2.83      +0.01      +0.35 
 Tsingtao Brewery A             66.16      66.16       unch       unch 
 Yankuang Energy Group A        15.16      15.16      -0.57      -3.62 
 Zhongjin Gold A                21.41      21.41      -0.06      -0.28 
 
Source: FactSet 

By Kwanwoo Jun

LG Chem and China's Sinopec Group are jointly developing materials for sodium-ion batteries, the South Korean chemical company said Tuesday.

LG Chem, the parent of battery maker LG Energy Solution, said it signed a pact on Oct. 30 with Sinopec to develop next-generation cathode and anode materials for sodium-ion cells.

Sodium-ion cells are seen as cheaper than the lithium-ion products that currently dominate the battery market, because raw materials for sodium-ion cells are easier to access, LG Chem said.

Sodium-ion cells are also seen to perform better than lithium-iron phosphate batteries--a type of lower-end lithium-ion products--at low temperatures, it said.

Write to Kwanwoo Jun at kwanwoo.jun@wsj.com