Putin says Russia still willing to cooperate with OPEC, but warns that Moscow wants to pursue its own policies
Monday, February 11th 2002, 12:00 am
By: News On 6
MOSCOW (AP) _ Russian President Vladimir Putin warned OPEC that while Moscow is willing to cooperate with the cartel, Russia intends to be guided by its own interests.
In an interview published Monday in The Wall Street Journal, Putin also said that the Kremlin would like to see a price range of $20 to $25 for a barrel of oil.
That is lower than the goal of $22 to $28 per barrel set by the Organization of Petroleum Exporting Countries when it pressured Moscow into making output cuts to boost prices. The discrepancy suggests that Moscow's commitment to the cuts may be short-lived. A barrel now costs just under $20.
Putin said that Russia, the world's second-biggest oil producer, intends to ``preserve our independence to carry out our own policies.''
In recent years, Russia's privatized oil companies have recovered much of the world market share lost after the Soviet Union's collapse, when a lack of investment and political chaos cut production by half. That newfound strength has worried OPEC, which increasingly has looked on Russia as a major competitor in the world market.
OPEC frequently complained that whenever it curtailed output to boost prices, Russia simply increased its market share. Last year, OPEC confronted Russia and in a battle of wills demanded that Russia and other independent oil producers also cut output to prop up the sagging price of crude.
After protracted negotiations, Russia agreed to cut its oil exports by 150,000 barrels a day in the first quarter of 2002. The cut was less than OPEC had hoped for, but the cartel accepted it and went ahead with its own cuts. However, OPEC officials have since questioned Russia's commitment, and privately conceded that they didn't expect the Russian cuts to last beyond March.
Russia's oil industry produced 102 billion gallons last year, up 7.6 percent from the year before, according to government statistics. Of that, 47.5 billion gallons were exported, up 11.8 percent from 2000.
In the newspaper interview, Putin urged the United States to look on Russia as an alternative _ and more stable _ source of oil than the Middle East. He suggested that Russia's vast oil resources were a key reason for the United States to forge closer ties with its former Cold War foe.
Russia offers an alternative to ``traditional sources ... located in areas of conflict in the Middle East,'' Putin was quoted as saying.
Russia's economy relies heavily on oil exports, and its growth over the past two years has been attributed largely to high world oil prices. Economists have warned that Russia needs to diversify its sources of income.