Tuesday, December 21, 2004

Yukos forced by Putin to sell key asset: "The State had commandeered oil reserves of 11.63 billion barrels, or 17 per cent of Russia’s total, re-establishing control over a huge slice of an industry that is its main source of economic growth and international clout. “By doing so, the State will have restored its previous control over a big piece of an industry that is not only the most important element in the local economy, but, along with natural gas, is increasingly the modern equivalent of military might,” Christopher Weafer, chief strategist at Alfa Bank, said.

"The auction effectively reversed the controversial privatisation deal, in which Mr Khodorkovsky bought Yukos’s oil and gas fields at way below their market value in the mid-1990s. It served as a chilling warning to Russia’s remaining oligarchs, who bought up the pillars of state industry for a song in the chaos that followed the collapse of the Soviet Union."

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