Category: Russia

Russia Wasting Millions of Tonnes of Oil From Leaking Pipes thumbnail Russia’s ageing and leaking pipelines are wasting millions of tonnes of oil a year, causing widespread environmental damage that largely goes unreported, according to Greenpeace Russia. The pressure group says the problem is getting worse as Russia battles against falling oil prices and continued Western sanctions at a time when its pipelines need urgent repairs or replacing altogether. “Oil extraction and oil spills are now synonymous in Russia,” says Evgenia Belyakova, Greenpeace Russia’s Arctic project coordinator. “Spills often happen as soon as a well is opened but most of them occur because of the bad conditions of the pipelines.” Belyakova says that across Russia’s “hundreds of thousands of miles” of oil pipelines, many segments are still in use many years after their recommended lifespan has expired. To compound the problem, Russian oil companies are not obliged to record […]

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The Central Bank of Russia in Moscow. Banking officials said it may be time to embrace domestic credit rating options. File Photo by DyMax/Shutterstock. MOSCOW, April 8 (UPI) — As low oil prices and Western-backed economic sanctions hammer Russia, the head of the central bank said it was time to embrace domestic rating agencies. A draft law regulating Russian credit rating agencies was introduced in February as economic problems became more evident. Central Bank Chairwoman Elvira Nabiullina said at a banking conference in Moscow it was time to develop more credit autonomy . "We are thinking about gradually moving away from international ratings and developing our own ratings industry with Russian agencies," she said Wednesday. Ratings agency Moody’s in February lowered its assessment of seven Russian financial institutions, including the banking arm of Gazprom, because of the expectation of a "prolonged recessionary environment," in the Russian economy. The downgrade […]

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Russian oil producers benefiting from last year’s ruble collapse used relatively cheaper service costs to increase drilling and boost crude output in March, according to Sberbank CIB. Development drilling jumped 23 percent in the first two months of the year, helping push oil output to 10.71 million barrels a day, Sberbank CIB analysts Alex Fak and Valery Nesterov wrote in a research note Friday. That matched the post-Soviet record level of production in January. “Oil companies benefited from relatively low drilling fees paid to service contractors under old contracts,” the analysts said. Tax changes lowering export duties provided further stimulus. Russia has increased output in the face of slumping prices for Brent crude, which trades now at less than half of the peak price in 2014. Under Russia’s tax system, the state bears most of the price risk, while the currency collapse benefits exporters, which earn in dollars and […]

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The ruble and Russian stocks pared weekly gains as falling oil prices threatened to undercut the nation’s budget revenue, stoking concern assets have climbed too far. The currency retreated from the strongest level this year, trimming its third weekly advance to 1.7 percent by 6:51 p.m. in Moscow. Brent dropped 3.8 percent on Thursday after a nuclear pact sealed between Iran and world powers stoked speculation supplies may increase. Markets in the U.S. and U.K. were closed for holidays on Friday. The ruble’s strength amid weaker oil prices risks exacerbating a budget shortfall that’s forecast to be the widest since 2010. In ruble terms, the price of a barrel of Brent is near the lowest in four months, complicating the government’s revenue plan as the economy of the world’s biggest energy exporter heads for its first recession in six years. “For the Russian economy in its present state, there’s […]

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MOSCOW–U.S. oil and gas company ExxonMobil Corp. (XOM) has filed a claim with the Stockholm Arbitration Court looking to change the way the firm is taxed by the Russian government it told the country’s energy ministry on Monday, a spokeswoman for the ministry said Friday. The spokeswoman declined to elaborate on details of the lawsuit, but confirmed a report by Russian daily Vedomosti which said the company was seeking to change the way the taxation clause in the agreement on Sakhalin-1 –an oil and gas project in Russia’s far east in which it holds a 30% stake–is interpreted. ExxonMobil is seeking to be reimbursed for part of the income tax it has overpaid over the past six years, worth $500 million, Vedomosti’s report said. In mid-March Russian daily newspaper Kommersant quoted unnamed sources as saying ExxonMobil wants Russia to return several billions of rubles in taxes which it said […]

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MOSCOW, April 2 (Reuters) – Russian oil output edged up 0.6 percent in March to a post-Soviet high of 10.71 million barrels per day on increased production at Gazprom and Rosneft, Energy Ministry data showed on Thursday. The output topped December’s high of 10.67 million barrels per day (bpd), the data showed. The data includes output for crude oil and gas condensate which reached 45.275 million tonnes in March, versus 40.696 million the month before. Crude oil exports through oil pipeline monopoly Transneft rose by 2 percent to 3.91 million bpd, the ministry said. Oil and natural gas production accounts for half of Russian budget revenue, which has been hit by a 50 percent plunge in oil prices since June and Western sanctions over Moscow’s involvement in the Ukraine crisis. Oil and gas condensate production at Gazprom, the world’s top natural gas producer, jumped by 14 percent in March […]

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Poverty in Vladimir Putin’s Russia to increase as sanctions pressure builds, World Bank report finds. File photo by UPI MOSCOW, April 1 (UPI) — The health of the Russian economy depends in part on how well it can manage to thrive in an era of low oil prices and sanctions, a World Bank report said. The World Bank in a report said Russia’s mid-term economic prospects are likely to be clouded by the dual strains of a sustained bear market for crude oil and lingering sanctions pressure. "It is likely that when the full effects of the two shocks become evident in 2015, they will push the Russian economy into recession," the report said. Economic sanctions were imposed in response to crises in Ukraine. A Russian government forecast said the "only possible source of recovery" was an increase in investment demand. European sanctions imposed in July cut into the […]

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President of Russian bank VTB wants listing on Chinese stock market. File Photo by Stephen Shaver/UPI. MOSCOW, March 30 (UPI) — With Russian energy interests pivoting east, the head of Russian bank VTB said Monday he was looking to get listed on the Chinese stock exchange. Andrei Kostin said, on his way to an Asian investment forum, that his bank was requesting a rating from China’s Dagong Global Credit Rating Co. "We are heading in that direction," he said. "It is the right decision given the current situation." Rating is one of the preliminary steps toward entering the Chinese stock exchange as a listed company. The Chinese rating agency in early March gave Russian energy company Gazprom Neft a AA credit rating, denoting a stable outlook for its debt portfolio and long-term production potential. Parent company Gazprom received one of its best outlooks in the industry, a AAA, despite […]

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Gabrielius Landsbergis, a Lithuanian member of the European Parliament, said sanctions on Russia having clear impact on its economy. Photo courtesy: European Parliament. BRUSSELS, March 26 (UPI) — Along with the low price of oil, sanctions imposed on Russia in response to crises in Ukraine have struck a major blow to its economy, a European leader said. The European Union in March 2014 imposed sanctions against Russia after it annexed the Crimean Peninsula from Ukraine. Violence erupted in Ukraine the previous November after the former Soviet republic started a slow pivot toward the EU. Sanctions imposed in July cut into the Russian energy sector, which accounted for more than half of the government’s revenue. Gabrielius Landsbergis, a Lithuanian member of the European Parliament steering aid to Ukraine, said Thursday the sanctions have created huge problems for the Russian economy. "It’s difficult to measure the exact results, but what we […]

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