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  Wednesday, December 11, 2019
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Yesterday, Yukos halted oil shipments to China National Petroleum Corporation
The company thereby violated a relevant governmental agreement between Russia and China, as it had been given the task of exporting Russian oil to China. Kommersant reported that Chinese authorities refused to pay Yukos' customs and railroad costs. Sinopec, another Chinese state oil company, continues to receive the full amount of Russian oil exports, as unlike the CNPC, it agreed to pay transportation costs. Yukos fulfilled the promise it made on September 19, the day before Chinese Prime Minister Wen Jiabao visited Moscow and met with Russian Prime Minister Mikhail Fradkov. The company said it was suspending some of its direct exports to China on September 28. The Chinese prime minister's visit did not help the oil company; its bank accounts remained frozen and it still cannot afford oil exports to China. This year, CNPC will receive 1 million fewer metric tons of oil. In 2004, the company was to receive 3.8 million metric tons of oil from Russia. (Yukos is responsible for all Russian oil exports to China.) Yukos said that unlike CNPC, Sinopec had agreed to pay railroad and customs costs for next month. According to Pyotr Zolotaryov, acting President of Yukos Refining and Marketing, Yukos spends $98 million to $100 million a month on exports to China. Sinopec apparently paid about $40 million for Yukos to ensure the uninterrupted oil supplies in October. Since Yukos and its affiliated oil producing companies' bank accounts are under arrest, the company has to resort to such schemes to continue exporting oil to China and other countries. "All these schemes are very unstable," a YUKOS source told the newspaper. "We do not know how the company will export oil in November or whether it will export it at all."
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