RUSSIA: Central Bank policy of allowing the ruble's devaluation, while limiting excessive exchange rate volatility will not affect foreign oil companies in Russia, says analyst

Record ID: 344204

  • Title: RUSSIA: Central Bank policy of allowing the ruble's devaluation, while limiting excessive exchange rate volatility will not affect foreign oil companies in Russia, says analyst
  • Date: 2nd June 2012
  • Summary: MOSCOW, RUSSIA (JUNE 1, 2012) (REUTERS) VARIOUS EXTERIOR MOSCOW CITI BUSINESS CENTRE RENAISSANCE CAPITAL CHIEF RUSSIA ECONOMIST RENAISSANCE CAPITAL IVAN TCHAKAROV WALKING IN HALLWAY (SOUNDBITE) (English) RENAISSANCE CAPITAL CHIEF RUSSIA ECONOMIST RENAISSANCE CAPITAL IVAN TCHAKAROV, SAYING: "This is a policy that very many more mature emerging economies in the world are pursuing, so, in that sense, global players should find it relatively easy to operate in this environment to the extent that they're operating all over the world. So, Russia and the Russian Central Bank have been moving in the right direction in the way they operate monetary policy. So I don't really see any major negative impact on the way these big foreign oil companies are looking at the exchange market in Russia." VARIOUS EXTERIOR TNK-BP HEADQUARTERS IN MOSCOW PEOPLE ENTERING OFFICE BUILDING VARIOUS PLAQUE READING 'TNK-BP' ON BUILDING EXTERIOR VARIOUS LOTTE PLAZA BUSINESS CENTRE WHERE BP RUSSIA OFFICES LOCATED VARIOUS SIGN READING '8 NOVINSKY BOULEVARD' VARIOUS BUILDING WITH 'LOTTE BUSINESS CENTRE' SIGN PEOPLE WALKING OUTSIDE BUSINESS CENTRE KHANTY-MANSYSK REGION, RUSSIA (RECENT) (REUTERS) ENTRANCE TO OIL FACILITY, WITH EXCESS GAS TORCH BURNING IN BACK FLAGS AND EXCESS GAS TORCH VARIOUS OIL DRILL MACHINERY OIL WORKERS AT OIL DRILLING FACILITY MACHINERY AT OIL DRILLING FACILITY WORKERS WATCHING VARIOUS DRILL WORKING VARIOUS WORKERS OPERATING MACHINERY SIGN WITH WARNING SYMBOLS AT OIL FACILITY, INSCRIPTION READING IN RUSSIAN 'FLAMMABLE. OIL, GAS. NO SMOKING' ELECTRIC LINES NEAR OIL FACILITY
  • Embargoed: 17th June 2012 13:00
  • Keywords:
  • Location: Russian Federation
  • Country: Russia
  • Topics: Business,Economy,Politics,Energy
  • Reuters ID: LVAHL8598E7M7NAJCJ6PEZHC4QR
  • Story Text: Russia's Central Bank policy should not negatively impact foreign oil companies in Russia, an analyst said on Friday (June 1) as the rouble continued to plunge, falling to its weakest against the U.S. dollar since the height of the global financial crisis in 2009.
    "This is a policy that very many more mature emerging economies in the world are pursuing, so, in that sense, global players should find it relatively easy to operate in this environment to the extent that they're operating all over the world. So, Russia and the Russian Central Bank have been moving in the right direction in the way they operate monetary policy. So I don't really see any major negative impact on the way these big foreign oil companies are looking at the exchange market in Russia," Tchkarov, the chief Russia economist at Renaissance Capital told Reuters.
    The slide to 33.48 roubles to one US dollar on Thursday (May 31) amounts to almost 14 percent since the start of May and largely reflects the impact of growing turmoil in the euro zone on investors' appetite for riskier investments like commodities and emerging market currencies.
    Local demand for dollars has exacerbated the rouble's fall, with market sources saying that preparations for a buyback by Russia's No.1 oil producer Rosneft was among the reasons.
    Also on Friday, a Russian state firm reportedly offered to buy BP Plc's half share in its Siberian joint venture, according to a source, in what would amount to a stunning reversal for the British firm and a bold assertion of Kremlin control over the oil sector.
    The TNK-BP joint venture accounts for nearly a third of BP's output and has since 2003, been a cornerstone of its global strategy.
    Igor Sechin, CEO of state oil major Rosneft denied considering buying out the stake in the TNK-BP joint venture. But, two sources said, Russian state energy holding company Rosneftegaz - which controls Rosneft - could serve as a vehicle to do the deal.
    Selling out would cut BP loose from hostile partners and free it from an investment that had restricted its ability to pursue other opportunities in Russia.
    BP did not say who had made what it called "unsolicited approaches" to buy the stake, but a source close to the matter said one of Russia's state-owned oil and gas firms was involved.
    TNK-BP is Russia's No.3 oil producer and BP's stake is one of the biggest foreign investments ever made in the country. It has earned BP huge profits, but has long been plagued by acrimonious legal battles between BP and its Russian partners, the AAR consortium of billionaires.
    Analysts, including Tchakarov, refused to comment TNK-BP or Rosneft specifically.
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