Posted on 04/25/2006 4:10:30 AM PDT by vertolet
Russia's oil pipeline monopoly said yesterday deliveries to Europe would be cut and prices for Russian crude would rise once the country built a planned pipeline to Asia, in another indication of mounting global competition for energy resources, writes Neil Buckley in Moscow.
Semyon Vainshtok, chief executive of Transneft, told Nezavisimaya Gazeta that building a pipeline to China would reduce the $5-a-barrel discount that Russia's Urals blend crude sells at compared to West Texas Intermediate and Brent crude.
"We have oversupplied Europe with oil. And every economics manual says when there is excess supply the price falls. As soon as we turn towards China, South Korea, Australia, Japan, that will immediately take away part of our oil from our European colleagues," he said.
Gazprom, Russia's gas giant, last week warned it might shift its focus to China if its ambitions to expand in Europe were blocked.
Good news, I would love to see us back to coal that we have a lot of and stop this "oil idiocy".
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