China Oilfield Services (COSL), the country’s largest offshore drilling contractor, has decided to cut its capital spending by 3.3% for 2022 to 4.16 billion yuan (US$656 million), down from last year’s expected $678 million.

The Hong Kong-listed company said in a statement providing its latest strategic guidance that the capital expenditure is based on the operating conditions of the company in 2022.

The company said, citing a third-party forecast, that the total capital expenditure of global upstream exploration and development will increase by about 24% this year compared with 2021 amid the demand growth for oil and the market recovery.