China National Petroleum Predicts Low Prices on Slower Growth

China National Petroleum Corp., the nation's biggest oil company, expects economic growth to slow in the second half, keeping prices depressed.

Costs will be controlled and steps will be taken to improve fund-raising to cope with the situation, the state-controlled company, known as CNPC, said in a statement posted on its website today, without giving a specific price forecast. Company officials met yesterday in Beijing to review first-half operations and discuss strategies for the second half.

China, the world's second-biggest oil consumer, today reduced fuel prices for the third time since May, further squeezing refining margins of CNPC and China Petrochemical Corp. The government may say this week gross domestic product in the second quarter expanded at the slowest pace since 2009, according to a Bloomberg News survey of economists.

CNPC must seek "progress among all the risks and uncertainties" to achieve production goals set at the beginning of the year, the statement said. Natural gas sales were better than expected in the first half and oil-product sales failed to increase as much as in the "peak seasons," the statement said, without elaborating.

Overseas oil and gas production rose 3.5 percent from a year earlier to 50.52 million tons, CNPC, the parent of Hong Kong and Shanghai-listed PetroChina Co., said in an online newsletter on July 9.