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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: articwarrior who wrote (42533)	4/18/1999 2:37:00 PM
From: Rob Shilling	Read Replies (2) \| Respond to of 95453

OT -- LUKOY, re:articwarrior. Russia has indeed had a hard time as of recent. I don't know exactly what Russians you talked to but I am not sure everything you posted is accurate. Some facts: LUKOY -- increased exports dramatically in 1998 LUKOY -- Made around $250 million in 1998, most after the devaluation decreased its costs by over 70% LUKOY -- increased total oil output in 1998 LUKOY -- has paid all debt on time LUKOY -- has implemented a cost reduction campaign in the face of lower oil prices ---- Nobody in the press seems to talk about Russia when they talk about emerging markets. The assumption is that Russia will not improve without IMF help. IMF help is indeed coming in as little as 1 month. But Russia's economy has already showed unexpected signs of improvement. Industrial production is already higher now than in 1998 and consumer spending rose for the first time since the crisis in March. Many people have been paid their back wages and most are now getting paid regularly. Russia's budget is tight. Even with an average Brent oil price of $11.8 in the first quarter, Russia's total deficit was $200 million (basically zero). Current Brent oil prices are over $15 and natural gas is over $2.10. Considering that 50% of Russia's economy is oil and gas and 75% of its tax revenues come from oil and gas, Russia is looking to show some MAJOR improvement shortly IMHO. This is why I say Russia is like a leveraged bet on oil prices. From some of the Russians that I know, I have been told that Lukoil is a very rich company and very well run.