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Gold/Mining/Energy : Oil & Gas Price Economics -- Ignore unavailable to you. Want to Upgrade?

To: Archie Meeties who wrote (213)	6/20/2000 6:23:00 PM
From: kingfisher	Read Replies (2) \| Respond to of 350

06/20 06:42 Russia Plans to Cut Oil Exports 5.9% in Third Quarter (Update1) By Eduard Gismatullin Moscow, June 20 (Bloomberg) -- The Ministry of Fuel and Energy said it plans to cut oil exports 5.9 percent in the next three months, compared with the second quarter, as it plans to deliver more crude to refineries to saturate the domestic market. Russia plans to export 32 million tons of oil in the third quarter, after exporting about 34 million tons in the second quarter. Russian oil companies exported 27 million tons of crude in the third quarter last year, down 6.3 percent from 28.8 million tons in the second quarter of 1999, according to Energy Intelligence Group's market report. Russia is estimating oil production for the third quarter this year at 78 million tons, about equal to second-quarter output. The nation's oil companies produced 77.8 million tons of crude in the first quarter of 2000. Domestic refineries plan to process 46 million tons of crude over the next three months, up 4.5 percent from an estimated 44 million tons in the second quarter. ``We sent a proposal to the government to ensure obligatory crude deliveries to (Russia's) oil refineries in the second half (of the year),'' said First Deputy Energy Minister Alexander Kochnev. ``We want to keep this order as this is an effective way to ensure oil product deliveries to the domestic market.'' The ministry also plans to allocate additional export volumes to the companies, which increase oil production from the output reached in the previous quarter. The additional export volumes will be equal to the extra crude produced by a company during the previous three-month period. Rising Output ``We want to encourage companies to increase oil production each quarter,'' said Kochnev. ``Russia's oil production increased by 2 million tons in the second quarter and by 4 million tons since the start of the year, above the planned output.'' The ministry plans to encourage companies to deliver oil products to the northern regions of Russia to build up stockpiles for the winter season. The government plans to ensure as much as 2 million tons of oil product supply to these regions. Russia authorities are reluctant to participate in the Organization of Petroleum Exporting Countries meeting as the ministry's functions and regulations are not clear yet. The session, which starts in Vienna on June 21, will review any possible oil production increase to push prices down to a more-acceptable level. Brent crude oil for August settlement rose 0.36 percent, or 10 cents, to $28.08. ``No one goes to the OPEC meeting from the Ministry,'' said Kochnev. ``We (Russia) have a status of observers. The formation of the new ministry is more important to the new minister.'' The Ministry of Energy has drafted new regulations over its operation as a part of the new government. The proposals have been agreed with about 50 percent of the required government agencies. The Ministry of Nature Resources will have greater authority to supervise the nation's reserves and exploration license allocation processes, said Kochnev. The resources ministry will also draft any required legislation regarding the use of Russia's deposits, where the Ministry of Energy will be involved in the process of monitoring of oil and gas reserves operation. -------------------------------------------------------------------------------- ¸ Copyright 2000, Bloomberg L.P. All Rights Reserved.