'A lot of petrochemical facilities (worldwide) are being shut down because of lack of demand,' Petronas president and chief executive Mohamad Hassan Marican told reporters.

'We have brought our plants down in Kertih (in eastern Terengganu state),' he said. 'When there is no market, there is no point to produce the polymers.'

Petrochemical plants produce polymers and resins that are used to manufacture plastic consumer items.

With crude oil prices below US$50 (S$76.48) a barrel, Mr Hassan said the industry would have to firm alliances to weather the economic storm during 'this challenging environment.'

'As an industry, we all need to step back and re-look because of the credit crunch and economic crisis. We need to look at doing things together, like how we can share drilling rigs,' he said on the sidelines of a petroleum technology conference.

Mr Hassan said however that Petronas, which has expanded abroad aggressively in recent years, would not reduce its current and planned investments because of the negative environment.

'We do not jump from one side to another. Oil is a commodity. There will be years of high prices and years of low prices. The economic viability of a project is not based on today's prices,' he said.

'We are very lowly geared. We have sufficient internal funds to fund the projects. We have both the funds and capacity to borrow,' he said. -- AFP