Russia amidst world oil crisis
Right before a September OPEC summit in Osaka (Japan), leadership of the oil cartel is making efforts to save its face against a rather unfavorable background. Oil prices on the world market will soon exceed the limits of the price corridor fixed by oil producing countries. OPEC President Riwalnu Lukman still hopes to settle the problem inside the cartel. He says, there is no need to increase the quotas as the world economy copes with the present-day prices rather successfully. However, EU countries and the USA disagree with this opinion, but don’t yet make their grumbling loud. It is not ruled out that they will speak out their objections very soon. Meanwhile, OPEC desires Russia to be present at the Osaka summit, at least in the status of an observer.
At the same time, OPEC countries that have already exceeded the established oil production quotas, still fail to reach some common opinion. The USA and Europe insist that oil production should be increased, and prices consequently to be reduced. Intention of Washington to wage a war against Iraq is kind of a sign for Arabs saying that the same can happen to them as well. It will be probably no surprise for the whole of the world if US missiles will soon be dropped on Er-Riyadh residential areas. All necessary propaganda preparation has been already completed. However, OPEC President Lukman still hopes that the world has not changed at all. He suggests kind of a compromise to oil exporters: the quotas should be carefully raised so that oil prices remained on the same level at that. This variant is very favorable for Russia. Although we are currently on friendly terms with the USA, we would prefer oil prices on the world markets to be high, even higher than now. This is the reason why Russia objects to war against Iraq. If Iraq is bombed, Saudi Arabia will immediately increase oil production, and Russia will have to give up every hope to get more income to the budget. The present-day unstable situation, neither war nor peace and the army should be disbanded, is really favorable for Russia. The desire to be on friendly terms with the USA in the oil sphere disagrees with the political and economic pragmatism that is currently very urgent. Yesterday member of the Property Committee Ivan Grachev told his colleagues in Duma that upcoming world crisis posed no threat to Russia. He said, value of American and Japanese economies was artificially inflated, but had no support at all. The situation in Russia is quite different: all enterprises are awfully undervalued, that is why the big crisis will by-pass Russia. The deputy says, possible landslide of oil prices is the only vulnerable spot for Russia. Analysts say, if it happens the safety factor for Russia will make up half a year at most. Ivan Grachev is sure that mistakes of 1998 should necessarily be avoided: at that time Russia believed that interests of oil consumers, the USA and Europe, were more important. The deputy says, Russia should come to an agreement with OPEC. However, the government seems very much proud of the fact that Russia has been ahead of Saudi Arabia in oil production for several days already. Russia is more anxious about increase of oil supplies to the USA. It is a dangerous lack of foresight. There are many countries in the world that desire Russia and OPEC to conflict, and they are rather active in pursuing the objective.
The other day Japanese agency Kiodo Tsuhin published a report of its oil analysts. Japanese experts say: “Since the 9/11 attacks, interests of energy safety make the USA come closer to Russia and keep away from OPEC.” As long as the anti-terrorist operations proceed, the USA is more and more thinking about Russia as a strategic partner which is more important than NATO allies and uncompromising Arabs, who are at the same time crazy about Muslim universal supremacy. “Investments of US oil corporations in Russia’s economy, increase of American business in Russia are to form a new basis of Russia-America cooperation,” the agency reports. Japanese experts say, if cooperation between Russia and the USA gets stronger, OPEC will lose its influence upon the world oil market. The cartel will not be able to establish its prices on oil products in the whole of the world, the Japanese agency adds. That is what Japan is thinking about naive Russia, and what short-sighted Russia is meddling in. Is opposition to practically all oil producers really important for Russia? It is an open secret that the USA has neither friends nor allies, it pursues its strategic interests only. Why doesn’t Russia pursue it own interests as well?
Dmitry Slobodanuk PRAVDA.Ru
Translated by Maria Gousseva
Read the original in Russian: http://pravda.ru/main/2002/09/05/46652.html