PetroChina Co. said its third-quarter profit rose 21.6% to 51.84 billion yuan. Over nine months, it tied gains in its main businesses to higher crude prices, wider refining margins and international trading, even as it sold less fuel at home. China Petroleum & Chemical Corp., known as Sinopec, followed a day later with a 57.2% jump in quarterly net profit to 13.36 billion yuan under Chinese accounting standards.

The filings, made to the Hong Kong stock exchange on Wednesday and Thursday, show China's two largest state refiners making more money from refining while processing less crude and selling less fuel. For holders of their Hong Kong-listed shares, that is the trade-off to watch: Sinopec said domestic consumption of refined oil products fell 8.6% in the first nine months, which it attributed to high oil prices and faster substitution by new energy.

The third of the state majors, CNOOC Ltd., has not yet reported. Its board meets on Friday to approve results for the nine months to September, according to a notice the company filed on Oct. 16.

PetroChina: Higher Prices, Flat Output

PetroChina's revenue rose 10.4% to 793.57 billion yuan in the July to September quarter, according to its quarterly report. Its profit and revenue figures are virtually identical under international and Chinese accounting rules. For the first nine months, profit attributable to shareholders climbed 21.9% to 155.78 billion yuan on revenue of 2.32 trillion yuan, up 7%.

The company's average realized crude price was $77.65 a barrel over the nine months, up 18.5% from a year earlier. That trailed the move in the benchmark: PetroChina put the average Brent futures price at $88.86, up 27.1%.

Production did not grow. Oil and gas output was 1,376.8 million barrels of oil equivalent, essentially unchanged, as overseas output fell 10% on what the company called the geopolitical situation and lower crude production in the Middle East. The South China Morning Post reported in August that PetroChina was gradually restoring its Middle East operations after the U.S.-Israeli war on Iran disrupted energy flows. In the third quarter, PetroChina's overseas output rose 24.2% from the second quarter.

The upstream segment still carried the group, with nine-month operating profit up 19.7% to 152.02 billion yuan. Refining made an operating profit of 18.03 billion yuan, up from 14.45 billion yuan, which PetroChina credited to higher margins on refined products. Its marketing arm's profit rose 24.7% to 14.5 billion yuan, driven by international trading.

Domestic fuel sales fell 5.7% over nine months to 84.52 million tons, though third-quarter sales rose 14.6% from the second quarter. Capital expenditure in the nine-month cash flow statement was 159.44 billion yuan, down from 177.51 billion yuan a year earlier.

Sinopec: Margins Beat Volumes

Sinopec's quarterly revenue rose 9.3% to 769.74 billion yuan. Under international accounting rules, its third-quarter profit rose 63.6% to 13.6 billion yuan. Nine-month net profit under Chinese standards was 38.99 billion yuan, up 30%.

The company said the quarter benefited from wider margins on refining and chemical products and a richer product mix, with more jet fuel, naphtha and refining by-products. Inventory gains from rising crude prices helped the nine-month result.

The refining segment shows the shift. Its operating profit under international rules was 29.37 billion yuan for the nine months, compared with 7.19 billion yuan a year earlier, even though refinery throughput fell 10.2% to 167.37 million tonnes and total refined product sales dropped 11.4%. Chemicals still lost money. The segment posted a loss before interest and tax of 1.69 billion yuan, though its operating loss under international rules narrowed to 1.31 billion yuan from 7.08 billion yuan. Ethylene output fell 19%.

Upstream, Sinopec's realized crude price rose 23.4% to $81.92 a barrel. It measured the Platts Brent spot average at $94.05, up 32.7%, a different benchmark from the futures price PetroChina used.

Sinopec spent 74.5 billion yuan on capital projects in the nine months, 42.3 billion yuan of it on exploration and production. Operating cash flow rose 41.1% to 161.99 billion yuan. It completed a 500 million yuan A-share buyback on Sept. 14 and, by Sept. 30, had repurchased 139.1 million H shares for HK$601.2 million under a program still in progress.

What the Results Say About China's Fuel Demand

Both companies said China's economy grew 4.6% in the first three quarters. Fuel use did not follow. Sinopec cited the "dampening effect of high oil prices on demand" alongside the shift to new energy, and said domestic consumption of ethylene equivalents fell 9.4%.

The two companies did not agree on gas. Sinopec said domestic natural gas consumption rose 0.1%, by its own statistics, while PetroChina said it fell slightly. PetroChina's domestic gas sales rose 1% to 178.74 billion cubic meters.

Overseas markets have their own pressures. The Post reported in September that fuel and petrochemical prices were outpacing crude, and cited analysts as saying worldwide refined-product exports in August were 25% below the level a year earlier, with Russia and the Persian Gulf accounting for most of the shortfall. Sinopec said it managed fuel exports to lift returns across its chain.

Crude has stayed volatile this month. Brent eased from a near six-month high early this week as talks between Saudi Arabia and Iran calmed a supply scare, after attacks on Saudi energy sites and Hormuz shipping.

CNOOC's numbers come next. In a filing on Oct. 23, the company said it would release its third-quarter report after the market close on Friday and hold an online results briefing on the Shanghai Stock Exchange's roadshow platform at 4 p.m. Beijing time on Monday, Nov. 2.