Sinopec Shanghai Petrochemical Co, a major Chinese refining and chemical company, recorded a net loss of 462.1 million yuan ($64.40 million) for the first half of 2025, according to a report released on August 20, 2025. This marks a shift from the 27.9 million yuan profit reported for the same period in the previous year, driven by weaker demand for refining and chemical products.

A Sinopec worker walks past liquified natural gas (LNG) storage tanks at Sinopec's LNG terminal in Tianjin, China February 6, 2018.

The company’s net sales reached 33.498 billion yuan from January to June, reflecting a 10.66% decrease compared to the prior year. Sales of refining products dropped by 16.14%, while chemical product sales fell by 3.21%. “The market remains challenging due to strong supply and subdued demand,” a company spokesperson stated, highlighting the impact of increased adoption of new-energy vehicles on fuel demand and a cyclical low in the chemical sector.

Refinery throughput totaled 6.33 million metric tons during the six-month period, down 4.93% year-on-year. Sales volumes of refining products declined by 6.72%, influenced by lower crude oil prices, which also reduced weighted average selling prices across all segments. Production of diesel decreased by 13.56%, and aviation fuel output fell by 8.62%, while gasoline production saw a slight increase of 0.14%. In contrast, ethylene production, a key component for petrochemicals, rose significantly by 24.34% to 273,300 tons.

Capital expenditure for the period amounted to 408 million yuan, primarily directed toward the construction of a clean-efficiency upgrade for the Shanghai Petrochemical cogeneration unit. This investment reflects the company’s focus on improving operational efficiency and sustainability amid market challenges.

On Wednesday, Sinopec Shanghai Petrochemical’s shares closed at 2.90 yuan on the Shanghai Stock Exchange, up 1.75% for the day. However, the stock has declined 4.3% year-to-date, underperforming the SSE Composite Index, which gained 12.37% over the same period.

The company continues to navigate a complex market environment, balancing production adjustments with investments in cleaner technologies. Industry analysts note that the rise in new-energy vehicle usage and fluctuating crude oil prices are reshaping demand patterns, posing ongoing challenges for traditional refining and chemical sectors. Sinopec Shanghai Petrochemical’s efforts to enhance efficiency and adapt to market trends will be critical for its recovery in the coming months.