On January 8, 2026, with the approval of the State Council, China Petrochemical Corporation (Sinopec) and China Aviation Oil Group Corporation implemented a restructuring.
Industry insiders analyze that the "strong alliance" between Sinopec and China Aviation Oil will help enhance the resilience of the aviation fuel supply chain and ensure energy security for the aviation industry.
According to Standard & Poor's forecasts, China's aviation fuel consumption will increase from 39.28 million tons in 2024 to 75 million tons in 2040. After the restructuring, the two companies can leverage their advantages in integrated refining and chemical operations, and aviation fuel supply guarantee systems, reducing intermediate links and lowering supply costs, providing a strong guarantee for my country's aviation energy security.
The "strong alliance" between Sinopec and China Aviation Oil is conducive to enhancing the international competitiveness of my country's aviation fuel industry.
Currently, the major international aviation fuel service providers are mainly integrated petrochemical companies, such as Shell, BP, ExxonMobil, and Total, which have large scale, strong oil product and infrastructure guarantee capabilities, good reputation, and a well-established network, giving them a significant comparative advantage. In my country, aviation fuel production, sales, and refueling are handled by different companies, and the overall competitiveness needs to be improved compared to large international aviation fuel service providers. After the restructuring, the two companies will complement each other's strengths, helping the aviation fuel industry to become stronger, better, and larger, and improving its competitiveness.
The "strong alliance" between Sinopec and China Aviation Oil is also conducive to promoting the high-quality development of the sustainable aviation fuel industry.
Aviation carbon emissions are the most difficult area for emission reduction in the transportation sector, and sustainable aviation fuel (SAF) is a recognized main emission reduction route. Sinopec is one of the earliest companies in my country to possess SAF production capabilities, filling the gap in the application of domestically produced SAF on domestic aircraft. China Aviation Oil plays an important role in SAF promotion, application, and ecosystem building. After the restructuring, the two companies will deeply integrate their advantages in technological research and development, industrialization capabilities, storage, transportation, refueling, and international trade in areas such as SAF, promoting the research, use, and continuous iteration of SAF, driving the high-quality development of the industrial chain, and contributing to emission reduction in the aviation industry.
(Content quoted from People's Daily)
