NYSE begins delisting Chinese state-owned oil producer CNOOC
The New York Stock Exchange will suspend trading of US-owned China National Offshore Oil Corporation (CNOOC) shares today.
Per a November 2020 Trump administration executive order, US investors are barred from trading in firms designated as operating under Chinese military control. Consequently, CNOOC—China’s largest offshore oil producer—will be delisted by US stock exchanges, among other Chinese firms. Investors must divest from delisted companies by the northern autumn.
Targeting of such companies signaled the Trump administration’s interest in disentangling the US and Chinese economies by denying Beijing access to American links in financial supply chains. The restrictions follow earlier US attempts to stymie use of US-originated capital by China’s military amidst rising tensions in the South and East China Seas.
Expect CNOOC to appeal its delisting to the Securities and Exchange Commission. Despite the Biden administration’s emphasis on renewing US-China ties, however, expect the US to retain investment prohibitions. Biden remains uncommitted to removing restrictions and bipartisan congressional criticism of Beijing limits the potential for relief. The US will therefore likely maintain Trump-era policies on investment while using the prospect of change to drive cooperation with China in areas—including environmental protection—lacking negative security implications for US allies.
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