Oil majors ponder output cuts as crude prices fall, costs rise

PetroChina to reduce production from Daqing oilfield after decades of over-exploitation

Rising production costs and falling global crude prices are prompting Chinese oil companies to reduce output and explore other options for sustainable profit growth in the long term, a leading industry expert said on Tuesday.

Part of the reason why oil firms are resorting to such measures stems from the over-exploitation of the existing oilfields and their resultant inability to maintain output levels due to dwindling resource quality, reserves and higher production costs, said Li Li, research director at ICIS C1 Energy, a Shanghai-based energy information consultancy.