BEIJING, September 1 (InfoChina) - Shanghai Petrochemical (NYSE:SHI), Sinopec's second-largest oil refinery by capacity, is said to cut its product oil output this year by 13% to reduce losses amid ongoing domestic control on selling prices.

A media report quoted the company’s chairman Rong Guangdao as saying the company expected to produce about 3.90 million tons of product oil this year, a decrease of 600,000 tons from 2005. Output reduction will involve petroleum, diesel and kerosene.

Shanghai Petrochemical posted a 1.2 billion yuan loss from refining business in the first half, dragging the firm's overall profit down by 99.68%.

Its average first-half crude procurement cost surged 29% year on year to 64 dollars per barrel, while it was allowed to raise its average refined oil price by only 20% to 3,710 yuan/ton.