China Says Talks Proceeding

An official from China National Petroleum Corporation denied that talks had been suspended on deliveries of crude oil and loans for Russian oil companies after two sources from the Russian side said talks had been halted.

"I'm unaware of any suspensions of the negotiations," Wang Shengzi, a director of the Russian and Central Asian projects at CNPC, said Wednesday.

China was discussing lending state oil major Rosneft and pipeline monopoly Transneft $25 billion in export-backed loans as part of a broader oil supply deal.

"The working groups have suspended talks after the Chinese side raised quite absurd lending conditions," said one source who asked not to be named.

He said the Chinese had asked at the latest round of talks to peg interest rates on the loans to Libor, after having agreed previously to lend the money at 7 percent a year. (Reuters, Bloomberg)