China’s biggest oil refiner, Sinopec, posted a jump in third-quarter profit despite the nation’s stuttering economic recovery, helped by inventory gains and higher oil-product sales.

China Petroleum & Chemical Corp., the company’s formal name, saw net profit climb 38% to 17.94 billion yuan ($2.5 billion) in the quarter from a year earlier, according to an exchange filing on Thursday. Revenue rose 4.2% to 876.3 billion yuan.

Sinopec achieved the result even as oil prices fell from the same period a year earlier and as China’s economy struggled to gain traction. Global benchmark Brent crude jumped by more than a quarter over the three months through September, but was still 12% lower on average than in the same period in 2022.

Still, the recent strength in oil prices lifted the value of Sinopec’s inventories, which contributed 6.59 billion yuan of net profit, according to the company’s earnings presentation on Friday.

The company also reported a 19% rise in oil-product sales over the first nine months of the year, and a narrowing of losses at its chemicals business. Refining profits fell 9.1%.

Sinopec said it expects its diesel business to improve in the fourth quarter, after refining margins were hurt by the impact of China’s property woes on the market for the fuel, according to the presentation.

Overseas Investments

The oil and gas major is looking to add overseas investments, including a possible $10 billion gas deal in Saudi Arabia. Sinopec recently agreed to take a 30% stake in Kazakhstan’s largest polyethylene project, an endorsement of the longer-term outlook for its chemicals division.

The company’s capital expenditure was 108.2 billion yuan in the first nine months of the year, compared with 104 billion yuan in the same period in 2022.

While gas output rose 8.7% over the nine months, the company signaled that it’s still in the market for spot cargoes of seaborne fuel ahead of peak winter demand, although the quantities will depend on international prices, Li Li, deputy head of operations, said Friday.

Sinopec’s result comes after its peer Cnooc Ltd. posted a drop in third-quarter profit earlier this week. PetroChina Co. reports on Monday.

(Updates with details from earnings presentation from fourth paragraph)