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NEWS: Yukos' Shipments to China Are Suspended

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posted on Sep, 30 2004 @ 03:16 PM
In another blow to already tight oil supplies, Yukos, the Russian Oil giant has announced that it has suspended shipment to China until at least October 20th. No information was given as to the timing of the decision nor the October 20th resumption date. At the China National Petroleum Corporation, a senior official confirmed the 100,000 barrels a day they were to received were being stopped, but indicated that the shortage would have little impact.
MOSCOW - Embattled oil giant Yukos' shipments to China have been suspended until at least Oct. 20, company and government officials confirmed Thursday.

But Russian Railways chief Gennady Fadeyev did not explain why oil deliveries would resume on that date. A Yukos spokesman also said he could neither confirm nor deny that supplies would resume at the end of October.

A senior official at the China National Petroleum Corporation, whom the Interfax news agency identified by the surname Liu, confirmed the stoppage Wednesday but downplayed its effect.

"Yukos has suspended oil delivery to us. But we think this would have only a limited effect (on our operations)," the official said. "Oil transported from Russia accounts for a small proportion of our daily consumption."

A Yukos spokesman said that the company had halted the 100,000 barrels per day it delivers by rail to China National Petroleum Corporation, or CNPC, on Sept. 28. Fadeyev said that Yukos had only fulfilled its agreements with the railways monopoly until Oct. 1.

Earlier, Russian media had reported that the cuts would last until the end of the year and the company had said it would sell CNPC's oil within Russia.

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Earlier reports had indicated that the 100,000 barrels would be sold withing Russia itself and indicated that supply disruptions could last till the end of the year. A pending action by Russia’s Natural Resources Ministry has been postponed. The action would have revoked licences that allowed Yukos to prospect and pump oil. Yukos is teetering on bankruptcy due to back taxes. This, combined with tight supplies and disruption on the Gulf coast and Nigeria has rocketed oil prices to around $50 a barrel.

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