Sibur Plans to Cut Costs, Production

Sibur, the petrochemicals arm of Gazprom, said Thursday that it planned to slash spending and might temporarily cut production amid falling demand.

Management is "taking additional steps to address the impact of the negative trading environment," Sibur said in a statement. "A key focus in the near future is implementing a significant reduction in costs."

Customers are scaling back production and using less of the company's products amid global financial instability, the company said. Sibur's management in September called off an agreement to buy control, saying turbulence in equity and credit markets made financing the sale more difficult.

"Sibur is also reviewing the temporary reduction of production volumes, setting new priorities for the investment program and tighter management of working capital," the statement said.

Sibur will continue to develop existing plants and construct new production facilities while "reviewing all elements of these plans," it said.