Goldman Sachs Downgrade China Petroleum & Chemical Corp. (SNP) to Neutral

Goldman Sachs downgrade China Petroleum & Chemical Corp. (NYSE: SNP) from Buy to Neutral and removed the stock from its Conviction Buy List, citing weaker Chinese demand and potential for fuel-price cuts.

Shares of Sinopec, as China Petroleum is commonly known, fell as much as 3.5% in Hong Kong trading.

The firm said there is downside risk to their China oil demand forecast of 3.5% for 2009 as demand has decelerated and inventories appear to be rising especially for gasoline and diesel. They also said the Chinese government may lower domestic gasoline and diesel prices by early 2009.

China Petroleum & Chemical Corporation, through its subsidiaries, operates as an integrated oil and gas, and chemical company in the People's Republic of China and Hong Kong.

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