Ge Long Hui·2026-01-09 06:21Core Viewpoint - Citigroup's research report indicates that Sinopec Group's restructuring with China Aviation Oil Group is expected to enhance Sinopec's development in aviation fuel and sustainable aviation fuel, benefiting its refining and sales business while alleviating the impact of declining structural demand for gasoline and diesel in China [1] Group 1: Restructuring and Strategic Implications - Sinopec's restructuring with China Aviation Oil Group is anticipated to strengthen its position in the aviation fuel sector [1] - The long-term demand growth for aviation fuel is considered resilient, prompting attention to potential synergies between Sinopec's aviation fuel business and China Aviation Oil [1] - It remains unclear whether Sinopec Group will absorb assets from China Aviation Oil Group or establish a new entity [1] Group 2: Market Position and Recommendations - Citigroup does not see an urgent need for Sinopec to restructure or inject assets at the listed company level [1] - The target price for Sinopec is set at HKD 5.2, with a "Buy" rating [1] - Citigroup's preferred stock in the Chinese oil and gas sector remains PetroChina, which is viewed positively for its strong dividend capability in a low oil price environment [1]