Russian oil companies beg for state credits

In an address to Prime Minister Vladimir Putin the leaders of the companies say they will need help to handle international loans in order to avoid a drop in production, newspaper Kommersant reports. The company leaders also admit that strategic projects are in danger following the serious credit situation. Putin has earlier responded positively to the address of the Russian industry, promising a 50 billion USD federal support package to the market. However, with the federal support both to banks and oil companies, Putin and his government might now have to grant support also to a number of other companies in trouble. According to Kommersant, also aluminium giant Rusal is now knocking on Mr. Putin’s door. In their joint and unprecedented letter, the leaders of the four petroluem giants say they need help to cover 80 billion USD of debts from international finance institutions. That is not all however, the company leaders in their letter also request the Ministry of Finance and the Central Bank to “elaborate mechanisms for the financing of strategic projects”. According to the newspaper, the fact that also Gazprom’s Aleksey Miller is among the signatories to the letter has spurred surprise among analysts. Only few days ago the company CEO underlined that “the financial crisis under circumstances will affect the company”. Several planned Russian oil and gas projects are now in danger of being postponed. The financial crisis comes at the same time as oil prices drop. Oil company Lukoil itself admits that it can not assure growing production unless the oil price is higher than 109 USD per barrel.