Expansion of ethylene production has been put on hold by China's Sinopec Shanghai Petrochemical, which instead plans to focus on the oil industry.
The plan had involved boosting capacity by about 450,000t per year in a move designed to reduce the oversupply risk.
Sinopec instead plans to boost crude oil processing from 8.7 million tonnes in 2009 to 10.7 million tonnes in 2010, a 23% increase.
The Chinese firm said it has been encouraging its refineries to export more oil products to avoid flooding the domestic market.
