Despite marching orders from China\u2019s top leadership to maximize oil and gas drilling, the nation\u2019s energy sector is bending to the reality of the pandemic-fueled market collapse.\r\nCnooc Ltd. said Wednesday that 2020 spending targets have been reduced after the\u00a0coronavirus fight curbed oil demand\u00a0and\u00a0exacerbated a price crash.\r\n\r\n\r\n\r\n\r\nCnooc, the country\u2019s largest offshore driller, said it\u2019s targeting capital expenses between 75-85 billion yuan ($10.6-$12 billion) for 2020. That\u2019s down from a previous forecast of 85-95 billion yuan. That\u2019s down roughly 11 percent, going by the midpoint of both estimates.\r\nIt also reduced its production target to 505-515 million barrels of oil equivalent for the year, down from a previous range of 520-530 million.\r\n\u201cUnder the current low oil price environment, the company has adjusted its operating strategy promptly and implemented more prudent investment decision-making to ensure its long-term sustainable development,\u201d Cnooc said in a statement.\r\nThe cuts to capital expenditures, announced along with first-quarter results, come a year after state firms boosted spending to satisfy calls by President Xi Jinping to reverse a decline in oil output that\u2019s raised import dependency.\r\nChina\u2019s drillers are particularly sensitive to lower prices because their fields are older and require more work to sustain production, according to Rystad Energy AS. The consultancy estimates the country needs oil at $41 a barrel to break even, compared with $13 for Saudi Arabia and $11 for Iraq. Brent crude, the global benchmark, is hovering around $21 a barrel.\r\nChina became the world\u2019s largest oil importer in 2017 and top gas buyer the next year. The growing dependence on energy imports and the start of a trade dispute with the US provoked President Xi in August 2018 to urge the country\u2019s energy Goliaths to boost domestic output.\r\nDuring the price crash of 2016, PetroChina, the country\u2019s biggest oil company, started shutting fields it described as having \u201cno hope\u201d of being profitable. Production plummeted then, from a peak of 4.3 million barrels a day in 2015, when it was the world\u2019s fifth-biggest producer, to 3.8 million barrels in 2018, when it fell to number eight.\r\nThe cuts announced Wednesday are the first significant reductions by China\u2019s state oil industry this year.