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Home / Issue Archive / 2008 / May #5 / Russian Government Tells Majors to Pump More Oil

№ 5 (May 2008)

Russian Government Tells Majors to Pump More Oil

Russia's influential deputy prime minister Igor Sechin has held a second meeting in two weeks with top oil executives to discuss how to avoid a decline in oil output this year

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"It seems that he has been given a task to prevent the output from falling," one source said.

A second source said Sechin asked oil companies on Saturday to maintain production levels at a time when the government was prepared to cut taxes on the industry.

"We are cutting taxes not in order to help you raise dividends," a second industry source told Reuters when asked what was Sechin's main message to oil firms.

Sources said chief executives of Rosneft, LUKOIL, Surgut and Russneft attended the meeting.

Sechin, previously deputy Kremlin chief of staff and one of the closest allies of former president Vladimir Putin, moved to the deputy prime minister job earlier this month after Putin became prime minister. Putin's preferred successor Dmitry Medvedev was elected Russian president in March.

Putin has asked Sechin, who is also chairman of Russia's largest oil producer, state-controlled Rosneft, to look after the Russian energy sector.

Sechin said earlier this month he believed Russian oil production would not fall this year after analysts said the decline became unavoidable following the very poor performance of the sector in the first four months.

The fall will be in deep contrast with impressive spikes in previous years, which allowed Russia to increase its production by over 50 percent and produce more than the world's leading oil nation, Saudi Arabia, during some months.

Sechin is seen as one of Russia's most secretive politicians, but has appeared several times in public and commented on a few topics since his nomination in May.

Source: Reuters

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