Morning Star: Raising the target price of CNOOC (00883) to HK$32, basic cost control is still strong

The Zhitong Finance App learned that Morningstar released a research report saying that the fair value forecast for CNOOC (00883) H shares was raised by 10.3%, the target price was raised from HK$29 to HK$32, and the fair value forecast for A-shares was raised at the same time. CNOOC's net profit for the first half of 2026 increased 23% year-on-year, thanks to an average increase in oil prices of 24% and a 4% increase in net oil and gas production.

Morningstar pointed out that CNOOC's performance was basically in line with the forecast, and production for the first half of 2026 reached 50% of the full-year forecast. The bank believes that the 1% year-on-year decline in production in the second quarter was temporary, partly due to disruptions in the Middle East project. Management continues to emphasize achieving reserve replacement and production growth under the 2026-2030 five-year plan framework, which supports the bank's forecast of a 2.3% compound annual growth rate of production over the next five years.

Although the comprehensive cost rose 10% to $29.70 per barrel of oil equivalent, inflation lags behind the rise in oil prices and is partly driven by the appreciation of the RMB, and the company's basic cost control remains strong. The bank expects the average comprehensive cost over the next five years to be around $30 per barrel of oil equivalent.