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Putin, top 5 Russian oil firms to discuss export duties - paper

12:54 10/11/2008
MOSCOW, November 10 (RIA Novosti) - Prime Minister Vladimir Putin will meet Monday with the heads of Russia's top five oil companies to discuss crude export duty cuts amid the ongoing global financial crisis, a business paper reported.

The list of companies invited to the meeting includes state-run Rosneft, Gazprom Neft, the country's largest independent crude producer LUKoil, the Russian-British joint venture TNK-BP, and Surgutneftegaz, as well as the national pipeline monopoly Transneft, a source close to the government told Vedomosti.

World oil prices have fallen more than 50% from their record highs of $147 per barrel in July, as the global credit crunch has brought fuel demand down in most oil-consuming economies.

Russia's oil majors hope the meeting will discuss the issue of export duty on oil, the top managers of two companies invited to the premier told Vedomosti.

A proposal on a new formula to calculate oil export duty is expected to be submitted to the government by December 1, the paper said. Currently, the rate is established once every two months based on the price of Urals crude on world markets over the previous two months.

However, the government has had to depart from this methodology twice due to the sharp decreases in oil prices. Most recently, the government acted a month early in reducing the rate to $287.3 per metric ton from November 1. But that was almost $100 higher than oil companies had expected, the paper said.

As a result, oil exports through the country's pipeline system dropped 25% below their normal level in the first days of November as companies held back oil in the expectation of a cut in the export duty from December 1, the paper said.

A source close to one of the oil majors told Vedomosti that the meeting could also discuss the rates of natural monopolies. A top manager of one of the oil companies said the country's five largest oil companies wanted pipeline operator Transneft, rail monopoly Russian Railways and the electric power sector to put their rate increases on hold.

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RIA NovostiPutin, top 5 Russian oil firms to discuss export duties - paper

12:54 10/11/2008 Prime Minister Vladimir Putin will meet Monday with the heads of Russia's top five oil companies to discuss crude export duty cuts amid the ongoing global financial crisis, a business paper reported. >>

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