June 1, 2017 / 12:49 PM / 4 months ago

Kremlin aide rules out Russian energy sector privatisations

ST PETERSBURG, Russia, June 1 (Reuters) - Further privatisations of Russian oil and gas companies were ruled out by an aide to President Vladimir Putin on Thursday.

“I believe the question of further privatisations of oil companies, including Gazprom and Rosneft, is not on the agenda,” Andrei Belousov, Putin’s economic adviser, said.

“We’ll revisit these questions in eight years,” Belousov told reporters on the sidelines of the St Petersburg International Economic Forum in response to a proposal by former Russian finance minister Alexei Kudrin, that state-run oil companies should be sold off in the next 7-8 years.

Seven years is significant because it is the time until the end of the next presidential term. Putin is expect to run in Russian elections in March next year, and polls make him favourite to win which would give him another six year term.

Belousov said he viewed Kudrin’s proposal “very negatively”, adding: “Precisely because we don’t know what the situation with oil will be in 8 years, ... what the situation will be with the oil companies, how not only market conditions will develop, but the strategy too.”

Kudrin is a standard-bearer for a group of economic liberals, many with influence over Russian policy-making, who believe the state has too overbearing a role in the economy and is suffocating private enterprise and curbing economic growth.

They face resistance though from a rival camp, influential in the Kremlin, who believe that the state has a vital role to play in the economy, in particular to protect strategic sectors.

The two are vying for the president’s ear at a time when the Kremlin is starting to formulate a strategy for the next presidential term.

Kudrin said that it was a black mark against Russia that, instead of shrinking the role of the state, it had allowed it to increase.

“The oil sector should be privatised in the next seven or eight years,” Kudrin told a panel discussion at the forum.

“Let’s open the barriers, foreigners will come. Right now there are lots of people wanting to work in the oil sector in Russia. I don’t see any problems with privatisation in this sector,” Kudrin said.

In the past few months, Russia sold off a minority stake in state-owned Rosneft, one of the world’s biggest oil companies, to a consortium of commodities trader Glencore and the Qatari sovereign wealth fund.

The state also sold a controlling share in mid-sized oil producer Bashneft. However, economic liberals said that was not a fully-fledged privatisation because the buyer was Rosneft. (Reporting by Polina Nikolskaya and Darya Korsunskaya; writing by Christian Lowe; editing by Alexander Smith)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below