Russia Co. to Sell Crude Oil to U.S.

MOSCOW --

Russia's No. 2 oil producer Yukos will send its first tankers to the United States this summer, a top executive said Thursday, as part of a Russian effort to offer U.S. consumers an alternative to Persian Gulf oil.

Russia currently supplies a tiny percentage of U.S. imports, but U.S. officials have expressed interest in increasing Russia's share of the market. Oil is Russia's chief export and oil export taxes are a big part of the national budget.

"We plan to start pilot oil shipments to the U.S. East Coast or the Gulf of Mexico," Mikhail Brudno, first vice president of Yukos, was quoted by the Interfax news agency as saying at an investor conference.

"We believe we will be able to develop such a system where oil shipments to the United States will be just as efficient as to Europe," he said. He did not say how much oil the shipments would include.

Other Yukos officials said the move was largely symbolic and it is still far too expensive for them to ship large amounts of crude to American consumers.

"For Russia to become a primary supplier to the U.S., it probably requires some additional infrastructure," Yukos chief financial officer Bruce Misamore said. "Some of the facilities that we need such as deep-water ports don't even exist."

Misamore said as long as Russian producers can sell all their crude closer to home, it makes no sense to lose money by paying extra transportation costs.

However "as long as we're expanding production we may have to look for new outlets to sell our crude ... and the U.S. could be one of those places," he said.

High world oil prices drove Russia's economic growth in 2000 and 2001 -- and the growth of Yukos and other Russian oil companies.

Yukos on Thursday announced that its net profit in 2001 fell to $3.5 billion from $3.7 billion the year before, as a fall in crude prices in the final months of the year offset its higher production volumes and exports.

The company nonetheless said it would raise its annual dividend 78 percent to 21 cents a share from 12 cents. That represents a dividend payout of approximately $500 million.

The figures were generally above analysts' forecasts.

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But Bush just took the Florida gulf coast out of the picture by caving in to the environmentalists. I don't call that brilliant. I call it cheap politics.

Unless a cheap alternative to oil is discovered within the next 20 years. we will be drilling in the Everglades, eastern Gulf of Mexico, off the California coast, and Anwar. And the environmental wackos will be leading the charge when their BMWs run out of cheap gas and their computers brown out.

You can take that to the bank!!

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