Decadent mood

Last year began with the optimistic forecasts of the Government for increasing oil and gas condensate production to 490.7 million tons in 2007. In February the Ministry of Industry believed that in 2008 the net growth rate of 1.8% - production will grow to 500 million tons. Oil companies are also predicted to increase production, however, modest: TNK-BP - by 0,7% in Gazprom Neft - by 2,8%, and Lukoil - by 2%. Pessimistic official projections emerged only in October. Energy Minister Sergei Shmatko said that he expects a decline of about 1%. Yesterday was published the first official statistics. According to the research enterprise "CDU TEK, the 2008 oil and gas condensate in the country has decreased compared to that of 2007 by 0,7% to 488.105 million tons. Production increased by only one company - Rosneft. Last year, when was the final consolidation of the assets of Yukos, it produced 113.85 million tons of oil by 12,8% more than in 2007. Other companies, despite the forecasts, production cut: Lukoil - by 1,3%, to 90.2 million tonnes, TNK-BP - 0,9%, to 68.8 million tonnes, Surgutneftegaz - by 4,6 %, to 61.7 million tonnes, and Gazprom Neft - by 5,9%, to 30.7 million tons. "This is the first fall in annual production levels ranging from 1998 - says analyst at Troika Dialog," Valery Nesterov. - There are several reasons. Firstly, it is state tax policy: the government does not sufficiently take into account the interests of the oil industry. Thus, the cost production by small enterprises in December was 8.2 dollars, and a tax tied to world market prices - to $ 8.3 Secondly, the funding of some projects made it more difficult financial crisis as a result there has been a lack of investment. " In addition, the decline in production, according to Mr. Nesterov, due to the depletion of reserves: "In particular, such a situation is typical of fields in Western Siberia, the old ones are depleted and new ones have not yet started." This year it falls 3,5-4%, he said: "This would be the inertial scenario Ministry of Economic Development, under which production will decline by about 8 million tons. Falling oil prices have prompted some Russian companies to cut their investment: Gazprom Neft plans to reduce it by 25% to 70 billion rubles., In LUKOIL declare that they refuse "from some of the processing projects, and also intend to reduce the amount of drilling . However, Rosneft, on the contrary, intends to increase capital costs by 1.5 billion dollars, up 8.5 billion declined very sharply and exports. According to GP CDU TEK, Russian oil exports to CIS countries in 2008 amounted to 203.091 million tons (4.067 million barrels per day), which is 6.2% lower than in 2007. "This decline - the result of fiscal policy: due to the high level of export duties has been unprofitable for companies" - said Mr. Nesterov. In this case, at a meeting of OPEC in late December, Deputy Prime Minister Igor Sechin, who oversees the Russian government's oil and gas industry, announced plans to reduce exports by about 320 thousand barrels per day in a natural drop in energy demand and production decline due to underfunding of some projects . Meanwhile, the price of oil holds above $ 40, however, on Friday, a barrel of WTI has fallen in price on news about the increase in fuel stocks in the U.S. by 12%, to 40.87 dollars per barrel price of Brent was U.S. $ 44.42 Russian Urals sold U.S. $ 42.98 Just the same price, according to OPEC, is 70-90 dollars is why in the new year again, the cartel began to talk about further reduction of production (at the end of last year it had already been reduced by 2.2 million barrels per day). "If the downward trend in oil prices continues, the production cuts by OPEC at a meeting in March will not be a surprise," - said yesterday, Bloomberg Iran's representative to OPEC, Mohammad Ali Khatibi. According to him, OPEC will stay the course "until such time until the market becomes quieter and the prices to stabilize."