Due to their losses in the oil refining sector and their import of hundreds of thousands tons of refined oil, PetroChina and Sinopec are trying to report to the government their losses brought about by the widening gap between the rising international oil prices and the government-controlled oil prices.
Insiders said that this year's losses in oil refinery and refined oil imports might gain these two oil giants more financial subsidies from the government.
Those who oppose further subsidies argued that losses at oil refineries are far lower than the past two years. Moreover, the government already raised the refined oil prices this November.
A person inside Sinopec said that the profits could offset the losses at oil refineries during the first three quarters of this year. But the losses at oil refineries will be less that those of last year thanks to the rising oil prices. But PetroChina and Sinopec both have to share the losses accrued from importing hundreds of thousands of tons of refined oil. Insiders claimed that the government might reduce oil import duties to compensate these oil refiners for their losses.
For more details, please read the full story in Chinese. (http://www.eeo.com.cn/Politics/beijing_news/2007/12/13/89249.html)
(China.org.cn December 13, 2007)