Live Performance Conference | China National Petroleum Corporation: Integrated Industry Chain Resists Market Shocks, Accelerates Chemical Business Restructuring During the 14th Five-Year Plan

Every Daily Reporter | Yu Yang    Every Daily Editor | Wei Guanhong

On the afternoon of March 30, China National Petroleum Corporation (601857.SH) held a 2025 annual results media briefing in Hong Kong, China. Against the backdrop of an international oil price year-on-year decline of 14.6%, the company last year recorded revenue of 2.86 trillion yuan and attributable net profit of 157.32 billion yuan, down 2.5% and 4.5% year-on-year, respectively.

In assessing the company’s performance last year, Chen Houlian, Chairman of China National Petroleum Corporation, said the company “outperformed the overall trend,” mainly due to the relatively fast development of China’s economy and comparatively strong market demand, and that the company’s unique and complete industrial chain also played a positive and effective role in responding to market shocks.

Chen Houlian Picture source: By Yu Yang, Every Daily Reporter

According to the briefing, since late February, the situation in the Middle East has changed rapidly. At present, the company’s operations are generally normal. Crude oil and natural gas imported through the Strait of Hormuz account for about 10% of the company’s total operating volume. The company’s two major oil and gas industrial chains can ensure long-term, stable operations at relatively high and steady load. However, the investment business in the Middle East region has been affected to varying degrees.

In 2025, China National Petroleum Corporation’s oil and gas supply capability continued to strengthen. Domestically, the results of increasing reserves and production capacity were significant: it achieved 3 major breakthroughs and 7 important discoveries, while also deeply tapping the potential of mature oil and gas fields. Overseas, oil and gas projects operated steadily, making solid progress in Brazil, Africa, and Central Asia. For the full year, the company achieved oil and gas equivalent production of 28.6k barrels, up 2.5% year-on-year.

Zhang Daowei, Executive Director and Senior Vice President of China National Petroleum Corporation, said in response to questions from a reporter with The Economic Daily when asked about the current situation that, given changes in the present environment and the importance of oil and gas in the energy structure, the company will resolutely and unswervingly increase investment, strengthen its “internal capabilities,” ensure the reserves-to-production ratio remains stable and maintain a low-cost strategy, so as to achieve steady improvement in the crude oil business and rapid development in the natural gas business.

In recent times, the tense situation in the Strait of Hormuz has continued to pull at the world’s energy nerves. Has China National Petroleum’s business been significantly affected?

According to the briefing, the company’s self-produced crude oil and natural gas, crude oil and natural gas imported through pipelines, overseas share oil and share gas in non-Middle East regions, and long-term contract trade agreements in non-Middle East regions—all together account for about 90% of the company’s crude oil processing volume and natural gas throughsales volume. The company’s two major oil and gas industrial chains can ensure long-term, stable operations at relatively high and steady load. During the “14th Five-Year Plan and beyond” period, China National Petroleum’s oil and gas and new energy businesses will further enhance the capacity for efficient energy supply, continue to intensify efforts in domestic exploration and development as well as increasing reserves and production, and consolidate the “three 100-million-ton” pattern—namely, domestic crude oil production, the equivalent of domestic natural gas production, and the equivalent of overseas oil and gas equity production.

Beyond upstream business, in 2025, China National Petroleum continued to promote the transformation and upgrading of its refining and petrochemical as well as chemical industry business, along with structural adjustments. According to the briefing, the company’s vision target has been improved from “building a world-class integrated energy company” to “building a world-class integrated energy and chemical company,” with an even greater emphasis on the dual-wheel drive of energy and chemicals and on systematic development.

In 2025, the company’s refining and petrochemical and new materials businesses achieved operating profit of 100M yuan, up 13.4%. Among them, the refining business achieved operating profit of 24.25B yuan, up 19.1%, mainly due to an increase in unit gross margins in refining; the chemical business achieved operating profit of 21.7B yuan, down 19.4% year-on-year, mainly due to relatively loose supply and demand in the chemical market, which narrowed the gross margin space for chemical products.

Ren Lixin, Executive Director and President of China National Petroleum Corporation, said that judging from the current situation, the chemical market is still a incremental market, and its main problems lie in fierce competition in low-end segments and insufficient supply relative to demand in high-end segments—for example, the degree of external dependence for high-end polyolefins and high-end electronic chemical goods is still relatively high. The key going forward is to resolve structural contradictions, and accelerate the company’s industrial structure adjustments.

Chen Houlian said the company will adhere to making refining more refined, strengthening basic organic chemicals, expanding new materials, and improving bio-manufacturing and fine chemicals, accelerating its move toward the mid-to-high end of industrial chains. By 2030, it will generally form an industrial pattern of “refining for petrochemicals and producing fine chemicals and materials,” with the output of the new materials business doubling by the end of the “14th Five-Year Plan and beyond” period compared with 2025. At the same time, it will step up the development of bio-manufacturing, develop new productive forces such as bio-materials in a manner suited to local conditions, accelerate the layout of future bio-manufacturing industries such as synthetic biology, and related efforts.

Innovation ranks first among China National Petroleum’s five major strategic priorities. With the in-depth implementation of the “Artificial Intelligence+” initiative, China National Petroleum has once again emphasized its focus on digital intelligence technologies.

Chen Houlian noted that the current technological revolution and industrial transformation are advancing deeply, and artificial intelligence has become a key variable, having a major and far-reaching impact on the energy industry. In recent years, the company has proactively embraced the wave of artificial intelligence, promoting the integrated development of “Artificial Intelligence+Energy,” enabling coordinated and linked “Energy+Artificial Intelligence,” and initially building “Digital Intelligence China National Petroleum.”

In 2025, China National Petroleum’s R&D expenditure was 2.54B yuan, accounting for 1.0% of the company’s operating revenue. The share of R&D expenditure that was capitalized was 13.6%.

Looking ahead, the company has already deployed and is implementing a special initiative on “Artificial Intelligence+,” taking it as the core engine to rebuild production factors, reshape research paradigms, and restructure the value-chain.

According to the briefing, at the research level, China National Petroleum will actively promote the deployment and implementation of “AI for Science” within the company, build an AI-driven basic science platform, accelerate R&D in earth sciences, materials science, and synthetic biology, enhance the original capability and R&D efficiency for major scientific discoveries, and create a new paradigm for technological innovation in energy and chemicals.

At the application level, the company will continuously expand application scenarios for the Kunlun large model, accelerate research and development and application of embodied intelligent technologies such as embodied oil-adding robots and low-altitude intelligent inspection and patrol unmanned drones, deploy digital employees and AGI intelligent agents in batches, and accelerate the formation of a new form of human-system with core features including intelligent perception, intelligent decision-making, and intelligent operations.

A massive amount of information and precise analysis—right on the Sina Finance app