RTOB: Say No To Sinopec

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If you're looking to invest in a Chinese OIL stock then no matter what you do you must AVOID Chinese OIL company SINOPEC/China Petroleum and Chemical Corp. (SNP).

http://www.marketwatch.com/news/story/petrochina-get-its-first-subsidy/story.aspx?guid=%7BB47CB587%2D9A79%2D4516%2DAC6B%2D22280EC7F4BF%7D

Per the above link:
"PetroChina (PTR) and Sinopec have been hit hard by ballooning refining losses since the second half of 2007, because China's retail fuel prices remain lower than international prices under Beijing's tight control amid mounting inflationary pressure (In other words, the Chinese government is manipulating consumer gasoline prices lower than their real internationally established prices...FORCING the domestic Chinese oil refining companies like Sinopec to 'eat' the difference/operate their refining units at a loss...FYI, currently Beijing is regulating gas prices at the subsidized equivalent of $2.90/gallon...FYI all over again, this is also happening in India, another country where the consumer's cost of oil is very much subsidized + eased by the government.)

Sinopec said earlier its refineries would break even if oil prices fall back to $76 a barrel or below (Anecdotally...ARE YOU KIDDING ME? If you need $75 oil to BREAK EVEN then your earnings must be facing some serious HEADWINDS in this environment given that crude's at $115/barrel!!)

Sinopec is hit harder by high global oil prices, as it imports about 80% of its total oil needs. PetroChina, on the other hand, imports about 20%-30% of its oil needs."

Data Courtesy: Marketwatch.com, snagged on 4/20/08.