Category:

Russia revisits oil-for-goods deal with Iran

Iranian Minister for Oil Bijan Zanganeh hasn’t yet given formal endorsement of long-mentioned oil-for-goods deal with Russia. UPI/Maryam Rahmanian The deal where Iran would send oil to Russia has been in the works for much of the year. "We can export a big volume of our non-raw materials exports, such as equipment for the oil and gas industry, agricultural machinery, motor vehicles, aircraft, railway cars, power machines, electricity generators," Minister Alexei Ulyukayev told reporters Sunday from Moscow. Iranian Oil Minister Bijan Zanganeh has hinted that the Iranian government endorsed such a deal , but nothing was formalized. Both sides already cooperate in a variety of fields, with Russia supplying fuel for Iran’s nuclear reactor at Bushehr. Both countries are also the targets of Western economic sanctions, with Russia facing pressure for its stance on Ukraine and Iran getting squeezed for its controversial nuclear program. Multilateral nuclear negotiations with Iran […]

Posted On : Published By : Tom Whipple
Category:

Russian Firms Hire Lobbyists to Fight Senate Sanctions

Russian billionaire Gennady Timchenko faces U.S. sanctions over Ukraine. ENLARGE Russian billionaire Gennady Timchenko faces U.S. sanctions over Ukraine. Agence France-Presse/Getty Images WASHINGTON—A Russian energy company partly owned by a friend of President Vladimir Putin has spent at least $280,000 in lobbying fees in the U.S. aimed in part at opposing a Senate bill that seeks to broaden U.S. economic sanctions against Russia for invading Ukraine, according to lobbying-disclosure records. The payments, made by OAO Novatek to Washington lobbying and public-relations firm Qorvis MSLGroup over three months ended Sept. 30, provide a window into the behind-the-scenes struggle in Washington over Western economic pressure against the Kremlin at a time when the U.S. is considering further business restrictions on Russia. The punitive measures have brought new work to Washington law and lobbying firms trying to help Western and Russian clients navigate one of the most complex sanctions regimes devised by […]

Posted On : Published By : Tom Whipple
Category:

Ruble Hits New Low As Oil Prices Decline

By Andrey Ostroukh MOSCOW–The Russian ruble weakened to a record low in early trading on Monday following a drop in oil prices. The ruble hit 51.85 against the dollar in the first minutes of trading on the Moscow exchange, easing substantially beyond a psychologically important level of 50. This takes the ruble’s year-to-date loss compared with the U.S. currency to more than 36%. Against the euro, the ruble depreciated to 64.55 after Brent crude prices slid below $69 a barrel for the first time since May 2010. The ruble is widely expected to remain under pressure in December because of unfavorable conditions in commodity markets as well as hefty debt repayments. According to central bank data, Russian banks and companies have to reimburse around $30 billion in foreign debt by the end of the year. -Write to Andrey Ostroukh at [email protected]

Posted On : Published By : Tom Whipple
Category:

Rouble suffers worst fall since 1998 crisis

The rouble nosedived on Monday, suffering its worst daily fall since Russia’s 1998 crisis amid renewed fears over the impact of tumbling oil prices on the country’s economy. The currency hit Rbs52.38 against the dollar in Moscow morning trading, down almost 6 per cent from its Friday close. This takes its decline since the beginning of the year close to 40 per cent. The plummeting currency raises the pressure on the central bank to resume market intervention, from which it had abstained since floating the rouble in early November. On November 10, the Bank of Russia abolished the band in which the rouble had so far traded and ended the daily interventions through which it had been propping up the exchange rate. But the central bank said it was reserving the right to intervene if it saw a risk to financial stability. Analysts said that while the bank’s move […]

Posted On : Published By : Tom Whipple
Category:

Russian Money Suspected Behind Fracking Protests

PUNGESTI, Romania — Vlasa Mircia, the mayor of this destitute village in eastern Romania , thought he had struck it rich when the American energy giant Chevron showed up here last year and leased a plot of land he owned for exploratory shale gas drilling. But the encounter between big business and rural Romania quickly turned into a nightmare. The village became a magnet for activists from across the country opposed to hydraulic fracturing, or fracking. Violent clashes broke out between the police and protesters. The mayor, one of the few locals who sided openly with Chevron, was run out of town, reviled as a corrupt sellout in what activists presented as a David versus Goliath struggle between impoverished farmers and corporate America. “I was really shocked,” recalled the mayor, who is now back at his office on Pungesti’s main, in fact only, street. “We never had protesters here […]

Posted On : Published By : Tom Whipple
Category:

OPEC Policy Ensures U.S. Shale Crash, Russian Tycoon Says

At today’s prices of just over $70 a barrel, drilling is close to becoming unprofitable… Read More OPEC policy on crude production will ensure a crash in the U.S. shale industry, a Russian oil tycoon said. The Organization of Petroleum Exporting Countries kept output targets unchanged at a meeting in Vienna today even after this year’s slump in the oil price caused by surging supply from U.S shale fields. American producers risk becoming victims of their own success. At today’s prices of just over $70 a barrel, drilling is close to becoming unprofitable for some explorers, Leonid Fedun , vice president and board member at OAO Lukoil (LKOD) , said in an interview in London. “In 2016, when OPEC completes this objective of cleaning up the American marginal market, the oil price will start growing again,” said Fedun, who’s made a fortune of more than $4 billion in the […]

Posted On : Published By : Tom Whipple
Category:

Russia’s Oil Giant Battles Debt After $55 Billion Deal

Igor Sechin spent $55 billion in 2013 to buy competitor TNK-BP and create a Russian oil colossus, pumping about 5 percent of the world’s crude. Almost two years later and investors have written off the deal. Battered by sanctions and oil’s accelerating price crash, OAO Rosneft (ROSN) has lost 38 percent of its market value this year in dollar terms and today the whole company, TNK-BP and all, is worth $50 billion. And buying TNK-BP has left Sechin, Rosneft’s chief executive officer and a long-time ally of Russian President Vladimir Putin , with a lot of debt to repay . State-controlled Rosneft owes about $60 billion to banks and bondholders, making it more indebted relative to earnings than any large oil producer apart from Brazil ’s Petroleo Brasileiro SA. “Their aggressive expansion and debt accumulation made them more vulnerable to the falling oil price and the effect of sanctions,” […]

Posted On : Published By : Tom Whipple
Category:

Russian Recession Risk Seen at Record as Oil Saps Economy

Russia will sink into recession at a Urals price of $80 a barrel, seven years after its economy grew 8.5 percent when its chief export oil blend averaged near $70, according to a Bloomberg survey of analysts. Urals at $80, or about $3 cheaper than its average in the month through November 15, will tip Russia into a contraction, according to the median estimate of 32 economists. The probability of a recession in the next 12 months rose to 75 percent, the highest since the first such survey more than two years ago, according to another poll. Russia, which receives about half of its budget revenue from oil and gas taxes, is closing in on its first slump since 2009 after dodging recession this year as it lurched from one crisis to another following the takeover of Crimea from Ukraine in March. Consumer spending , which accounts for half […]

Posted On : Published By : Tom Whipple
Category:

Russia’s Economy Minister Says Prepare for Lower Oil Prices –Interfax

By Andrey Ostroukh MOSCOW–Russia, one of the world’s leading oil producers, will have to prepare for a drop in crude oil prices after OPEC’s decision to keep its production ceiling unchanged, Russia’s economy minister said Friday, Interfax news agency reported. The 12-member Organization of Petroleum Exporting Countries decided Thursday to keep its production ceiling unchanged at 30 million barrels a day, sending Brent crude prices below $72 per barrel for the first time since mid-2010. The continued decline in oil prices threatens to weigh further on Russia’s economic growth. The Russian government draws around 50% of its annual revenue from oil and gas exports. "It is likely that it [an oil price] will be close to $80 per barrel. But no one can tell that for sure so we need to prepare for any developments," Alexei Ulyukayev said. Mr. Ulyukayev also said that his ministry will lower its oil […]

Posted On : Published By : Tom Whipple
Category:

Russia Says Will Keep Oil Output Steady In 2015

Russian oil companies will keep production steady in 2015, Energy Minister Alexander Novak says, after Moscow left a meeting with other major oil producers with no agreement on how to address weak oil prices. MOSCOW, Nov 26 (Reuters) – Russian oil companies will keep production steady in 2015, Energy Minister Alexander Novak said on Wednesday, after Moscow left a meeting with other major oil producers with no agreement on how to address weak oil prices. Russia, which is not an OPEC member, has watched nervously as oil prices have fallen 30 percent since June and analysts say Moscow had hoped to convince other members and non-members to support a production cut at an OPEC meeting on Thursday. After talks between Saudi Arabia, fellow OPEC member Venezuela and oil power Mexico ended without an agreement on Tuesday, Russia’s message was clear – daily average oil production of around 10.5 million […]

Posted On : Published By : Tom Whipple