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Coronavirus and low prices dash Chinese oil majors' plans for 2020

Sharp cut in capex expected as impairment risk looms

The coronavirus and plunging oil prices have forced China's oil majors to rethink their capital expenditure plans for 2020.   © Reuters

TOKYO -- All three of China's major oil producers have suggested they will slash capital expenditure this year as the novel coronavirus outbreak and plunging oil prices play havoc with their planning and raise the risk of impairment losses across the industry.

"We are facing a severe challenge in terms of our first-quarter operating results," said Zhang Yuzhuo, chairman of China Petroleum & Chemical, more widely known as Sinopec, at the company's conference call on Monday. In order to deal with the critical situation, the newly appointed chief said the company has kicked off a 100-day internal cost-cutting campaign, mobilizing the whole organization to improve efficiency.

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