HK Stock Market Move | Sinopec Shanghai Petrochemical (00338) rises over 6% after results; turns profitable in first three quarters; tight refined oil supply situation will persist

Sinopec Shanghai Petrochemical (00338) rose over 6% after its results, up 6.73% as of press time to HK$1.19, with turnover of HK$7.9093 million. On the news front, on October 29, Sinopec Shanghai Petrochemical announced its results for the first three quarters of 2026, with operating revenue of approximately RMB59.848 billion, up 1.7% year on year; net profit attributable to shareholders of the listed company of approximately RMB1.085 billion, turning profitable from a year-earlier loss; and basic earnings per share of RMB0.103. Goldman Sachs noted that refinery outages in the Middle East were about 1.6 million barrels per day above normal seasonal levels, while outages in Russia were about 4.2 million barrels per day above normal, with the two combined representing about 5.8 million barrels per day of excess outage volume, already exceeding the worst-case scenario assumption of 5 million barrels per day set in Goldman Sachs analysts' September report on a "nightmare-level refining crisis." Goldman Sachs believes that the global average retail fuel price is about US$223 per barrel, and refined product inventories are at low levels across all major hubs, leaving almost no buffer against additional supply shocks. Although European oil demand and US gasoline demand both fell about 2% year on year, and demand-side destruction is already reflected in the data, inventories continue to decline, with the war logic on the supply side overwhelming the textbook demand response. Against this backdrop, Goldman Sachs reiterated its recommendation to go long on European summer gasoline for 2027, characterizing it as a tool to hedge against further geopolitical escalation.