The delegation wants to find out Russian plans of oil production and export in an attempt to coordinate their efforts. OPEC is afraid again that Russia will increase its share on the world market for the cartel account.
On Saturday, an OPEC delegation headed by president of the cartel Ahmad al-Sabah arrived in Moscow. The delegation wants to find out Russian plans of oil production and export in an attempt to coordinate their efforts. OPEC is afraid again that Russia will increase its share on the world market for the cartel account. However, exactly in this moment Russian oil production export is having big problems.
After arriving to Moscow, al-Sabah pointed out that he intends to meet with Minister of Industry and Energy Viktor Khristenko, Foreign Minister Sergey Lavrov and head of the Federal Agency for Energy Sergey Oganesyan. He connected his visit with the Russian chairmanship in the G-8 which starts Jan. 1, 2006. â€œFor the first time, a oil producing country will head G-8 and establishing good communications with Russia will provide information exchange between OPEC and this organization,â€ al-Sabah stated. Besides, al-Sabah also has a position of oil minister of Kuwait. He arrived to Moscow to discuss Russiaâ€™s debt to Kuwait of more than $ 1 billion. This debt was made before Iraqâ€™s attack on Kuwait in 1990. According to the minister the sides already reached a preliminary agreement about repaying the debt.
However, the main goal of the OPEC delegationâ€™s visit is an attempt to find out how Russia is planning to behave itself on the oil market.
OPEC has a special interest about Russia policy toward the Chinese oil market. Thatâ€™s why it is not accidental that the cartel delegation arrived to Moscow straight from China. According to the Chinese information, Beijing receives from OPEC (mostly from Saudi Arabia and Iran) about 800,000 barrels a day. In the meantime, according to the forecasts, Chinese demand can reach 3 million barrels a day. Thatâ€™s why OPEC is afraid that Russia and other independent oil producers can strengthen their positions in the Chinese market. The Australian oil expert Robert Cole pointed out that â€œChina will not rely on OPEC to cover all its imported oil needs. With in some time Russia oil can become more important than Arabian and OPEC wants to secure its share in this market.â€
However, right at this moment according to the Ministry of Economic Development and Trade, production and export of Russian oil is undergoing big difficulties. If in 2004 the oil production by 9 percent and export by 13.1 percent, then in 2005, production went up by only 2.3 percent and export dropped by 1.2 percent. In 2006, production is supposed by grow by 3 percent and export by 4 percent. In 2007, production is supposed to increase by 2.3 percent and export by 3.8 percent. And finally, in 2008, increase in production will be only 1 percent and exportâ€”only 1.8 percent.
Source : www.kommersant.com