China Aviation Oil (Singapore) Corporation Ltd (CAO) reported net profit of US$41.39 million for the six months ended Jun 30, 2026, down 17.3 per cent year-on-year, as a sharp decline in trading margins offset higher contributions from associates.
Revenue slipped 8.8 per cent to US$7.81 billion, while basic earnings per share retreated to 4.78 US cents from 5.82 US cents a year earlier. The company did not declare an interim dividend.
By segment, investments in oil-related assets remained the key earnings driver, delivering US$45.71 million in pre-tax profit, up 66.6 per cent YoY on stronger results from the 33 per cent-owned Shanghai Pudong International Airport Aviation Fuel Supply Company (SPIA). Middle distillates, which include jet fuel and gas oil trading, posted a marginal US$36,000 pre-tax profit, hurt by higher procurement costs amid Middle East tensions and inventory impairment charges. Other oil products generated US$2.33 million in pre-tax profit, a 91.6 per cent slide from a year earlier, following CAO’s exit from crude-oil trading and a 99 per cent drop in volumes for fuel oil and naphtha.
Group gross profit shrank 83.8 per cent to US$4.91 million as escalating geopolitical risks in the Middle East inflated jet fuel sourcing costs and falling oil prices in Asia and the US West Coast triggered inventory write-downs. Total trading volumes contracted 46.3 per cent to 7.39 million tonnes, with crude-oil volumes effectively nil after CAO ceased that line of business on Jan 1.
Operating expenses rose 9.3 per cent to US$10.77 million, reflecting higher information-technology spending and staff costs, partly offset by a lower provision for expected credit losses. Finance costs increased 32.3 per cent to US$0.59 million. Share of profits from associates, however, jumped 67.3 per cent to US$45.91 million, driven by SPIA’s higher refuelling volumes and stronger oil prices.
Looking ahead, CAO said persistent geopolitical uncertainties, supply-chain disruptions and elevated inflation could weigh on global growth, which the World Bank projects at 2.5 per cent in 2026. Even so, the group expects continued recovery in international air travel, especially in China, and rising demand for sustainable aviation fuel (SAF) to underpin long-term opportunities.
CAO plans to leverage its enlarged parentage under China Petrochemical Corporation (Sinopec Group), which became its indirect controlling shareholder in July, to deepen access to refinery supply, broaden its aviation-fuel network across key hubs in Asia, Europe and North America, and build a first-mover advantage in SAF. The company also intends to invest selectively in strategic oil-related assets to enhance shareholder returns while maintaining a strong balance sheet.