Employees work on the production line of solar panels at a workshop of Jiangsu DMEGC New Energy Co., Ltd. on July 22, 2025 in Suqian, Jiangsu Province of China.
Vcg | Visual China Group | Getty Images
Profits at China’s industrial firms surged in March even as the war in the Middle East upended global oil markets and sent raw material costs soaring.
Industrial profits jumped 15.8% from a year earlier in March, National Bureau of Statistics data showed Monday, accelerating from the 15.2% surge in the first two months of this year.
In the first three months this year, enterprise profits expanded 15.5%, the fastest start to any year since 2018, barring the pandemic-driven spike in 2021.
The upswing follows a period of stabilization in 2025 when industrial companies’ earnings eked out a modest 0.6% growth after contracting for three straight years.
The soaring profits came even as rising global oil prices started seeping into the domestic economy, weighing on margins for manufacturers dependent on imported raw materials.
Brent crude oil prices have soared about 48% since the U.S.-Israel strikes on Iran began at the end of February, driving up costs for chemicals, fibers and plastics across the global supply chain.
The oil shock comes as enterprises’ profits were already under strain, with domestic demand remaining tepid amid a prolonged property market downturn and a gloomy job market that has fueled price wars across sectors.
A global rally in metal prices and Beijing’s effort to rein in excess production capacity and curb cutthroat competition have contributed to an easing of deflationary pressure.
China’s producer price growth turned positive in March, driven by higher oil prices, marking the first expansion in more than three years and ending the longest deflationary streak in decades.
Large onshore inventories of Iranian oil and crude on tankers at sea have provided some cushion for the world’s biggest importer.
The Trump administration said on Friday it had imposed sanctions on an independent “teapot” refinery in China for buying billions of dollars’ worth of Iranian oil, potentially harming a key energy source that accounts for a quarter of Chinese refinery capacity.
