Chinas Petroleum industry has undergone major changes over the last decade. In 1998, the Chinese government reorganized most state owned Oil and gas assets into two vertically integrated firms: the China National Petroleum Corporation (CNPC) and the China Petroleum and Chemical Corporation (Sinopec). Each of these companies operates a range of local subsidiaries. The other major state sector firm is the China National Offshore Oil Corporation (CNOOC), which handles offshore exploration and production and accounts for roughly 15 percent of Chinas domestic Crude Oil production. CNPC, Sinopec, and CNOOC all carried out initial public offerings (IPOs) of stock between 2000 and 2002. However, the government maintains a majority stake in each through state-owned holding companies bearing the same name. In general, CNPC and its affiliates tend to dominate in the north and west, Sinopec companies in the south, and CNOOC in offshore regions. Historically, CNPC has focused mainly on oil and gas exploration and production while Sinopec had been engaged in downstream activities such as refining and distribution. This pattern still somewhat exists, however restructuring during the 1990s helped to reduce this trend. CNPC and Sinopec operate virtually all of Chinas oil refineries and the domestic Pipeline network. The intention of the restructuring and IPOs was to make these state-owned firms more like vertically integrated international oil companies (IOCs) elsewhere. In connection with this process, the firms have been spinning off or eliminating many unprofitable ancillary activities. In early 2000, CNPC separated out most of its high quality assets into a subsidiary called PetroChina, and carried out its IPO of a minority 15 percent interest on both the Hong Kong and New York stock exchanges in April 2000. Sinopec also offered a 15 percent stake in its operations in its October 2000 IPO on the Hong Kong and New York stock exchanges. In February 2001, CNOOC held its IPO of a 27.5 percent stake after an earlier attempt in September 1999 was cancelled. In all of these stock offerings, only minority stakes were sold and the IPOs did not offer foreign companies a major voice in corporate governance. As a net oil importer since 1993, Chinas petroleum industry is focused on meeting domestic demand. Retail prices for petroleum products are regulated, with variations based on location and the type of consumer. The Chinese government maintains domestic price ceilings on finished petroleum products which, despite several decisions to increase domestic prices over the last couple years, have not kept pace with price increases in international markets. The Chinese government provides refiners with subsidies to ease the gulf between low domestic rates and high international oil prices. The eventual goal is to eliminate subsidized prices, but given the dependency of vulnerable segments of the Chinese population on cheap fuels, particularly in agriculture, it will likely take at least several years to accomplish this goal.