HOUSTON
ConocoPhillips said Wednesday it will pull out of the Yanbu refinery project being built in Saudi Arabia.
The Houston company's decision comes as energy demand remains weakened by the global economic slowdown. Refiners have struggled with thin profit margins.
ConocoPhillips said it told the Saudi Arabian Oil Company, known as Saudi Aramco, of its decision.
Company senior vice president of refining Willie Chiang said the project wasn't consistent with the company's strategy to reduce refining and selling activities, called "downstream" in the oil business. Exploration and production of oil is called "upstream."
ConocoPhillips and state-run Saudi Aramco reached a $6 billion deal in 2006 to build a 400,000 barrel-a-day oil refinery in the Red Sea city of Yanbu. The project was delayed when crude oil prices plunged in 2008, but last June, ConocoPhillips and Saudi Aramco announced that they had revived their plans.
The beginning of production was targeted for 2014.
ConocoPhillips shares fell 24 cents to $57.16 in morning trading.
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