China National Offshore Oil Corporation – CNOCC (00883.HK)

Business Summary:

CNOCC Limited is the largest producer of offshore crude oil and natural gas in China and one of the world’s largest independent oil and gas exploration and production groups. She mainly engages in exploration, development, production (E&P) and sale of crude oil, natural gas and other petroleum products. She maintains some of the lowest all-in production costs in the global oil industry. The Group owns four major oil-producing areas offshore China: the Bohai Bay, the western South China Sea, the eastern South China Sea and the East China Sea. Her assets are spread across Asia, Africa, North America, South America, Oceania and Europe. The stock is also listed on the Shanghai Stock Exchange, as code of 600938.SS.  

Financial Summary:

Net profit attributable to the parent company in the first half of the year 2026 was RMB 85.8 billion, a year-on-year increase of 23.4%, compared with RMB 69.5 billion in 1H2025. Total oil and gas sales revenue reached RMB 206.086 billion, a YoY increase of 20.0% (compared to RMB 69.533 billion in 1H 2025). 

The main cost of a barrel of oil is US29.70 (previous US$28.41) barrel of oil equivalent, maintaining a good cost competitive advantage. The average realized oil price was USD 85.49 per barrel (USD 68.29 previously). The interim dividend was HK$0.94 per share; compared with HK$0.73 previously. During the period, the group’s net oil and gas production was 398.7 million barrels of oil equivalent (BOE), a year-on-year increase of 3.7%. Capital expenditure for the first half of the year totaled approximately RMB62 billion.

The group is tracking toward a full-year production target of 800 million BOE for 2026, and is accelerating its 'green' strategy by expanding offshore wind power capacity

Investment Risk:

1. Fluctuating oil price limit upside potential for stock prices together with high commodity price volatility.
2. In view of the increase in geopolitical and sanctions risks, the group faces systemic exposure to shifting geopolitical friction, trade policies, and tariffs between the U.S. and China.
3. Political changes, tax adjustments, or regional territorial disputes of international joint ventures.
4. Exposure to RMB currency fluctuations and any possibly related loss from hedges
5. Higher-than-expected cost for material sourcing, production cost & network expansion may occur.

Technical Analysis:

Currently, its trailing price-to-earnings (P/E) is of ratio around 8. The stock prices hit 52-week high of $30.88 at the end of March, 2026. The price has dropped by around 20% from historical high; not counting ex-dividend factor.  Compared with 52-week low at the middle of October 2025, the price has jumped by around 44%. It is suggested to accumulate the share between $22 and the present price. Given the protection from low stock valuation, the target price for medium term and long term is $27 & $29 respectively. Cut-loss price will be $19.8.

References

www.hkex.com.hk 

www.etnet.com.hk

www.cnoocinternational.com

I, Gary Tam, am a licensed person under the Securities and Futures Commission. Until the date this commentary was published, neither I and/or my affiliates are the beneficiary of the securities mentioned herein or are entitled to any financial interests in relation thereto.