More job cuts needed

China's oil giants need to make further staff cuts in addition to already-announced redundancies in order to remain competitive, according to UBS Warburg regional head of oil and chemicals research Cheng Khoo. Ms Cheng said expected rises in labour costs at the three giants - PetroChina, Sinopec and CNOOC - may pose substantial cost pressures in the next few years as inflation creeps in. At present, labour accounts for 5 per cent to 10 per cent of their operating costs. PetroChina and Sinopec have said they will cut 10 per cent and 20 per cent of their staff in the next five years.