China National Offshore Oil Corporation (CNOOC) began trading on Chinas A-share market on Thursday, recording a 20 percent higher opening price at 12.96 yuan ($2.02) for each share at the opening, and the oil & gas section of stock market also saw increase during the morning trade.
The trade of CNOOCs stock was suspended for 30 minutes from 9:30 am to 10 am due to “abnormal fluctuations” according to an announcement from Shanghai Stock Exchange, due to a maximum increase of nearly 44 percent, scale fell back to around 20 percent.
“The significant surge of CNOOCs stock price may be caused by its relatively low valuation,” Dong Dengxin, director of the Finance and Securities Institute of the Wuhan University of Science and Technology, told the Global Times on Thursday, “but the more important factor is the increasing price of global oil and gas market, which also lifted most stocks in the section.”
CNOOC on Wednesday reaffirmed the normal operation of its overseas assets in Britain, Canada and the US, responding to media reports one week ago saying the oil & gas giant was planning to exit operations in the UK and North America markets over concerns its assets may become the target of the US-led sanctions.
Dong suggested the performance and investment potential of the company were better than its two main rivals, Sinopec and China National Petroleum Corporation (CNPC).
“Three Chinese major oil producers have ‘reunited in Chinas A-share market, which will become long-term investment targets for individual investors and firms based on their strong abilities of profit-sharing,” said Dong.
The share price of CNOOC hit 13.91 yuan at the close on Thursday mornings trade, representing a 28.8 percent increase.
CNOOC’s drilling platform on China’s Bohai Sea Photo:VCG
