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. Last Updated: 07/27/2016

Expert Warns Oil Slump Will Swallow Up Exports

LONDON -- Declining Russian crude oil production and rising domestic industrial demand could soon bite into Russian oil exports to the West, says Daniel Yergin, the Pulitzer-Prize-winning oil expert.

Buoyant Russian exports, combined with higher output from other non-OPEC producers contributed to a slump in world oil prices to five-year lows in February.

But Western consumers cannot be confident of Russia being able to maintain current export levels, given the growing private economy and subsequent higher energy use and faltering Russian oil output, said Yergin, now president of Cambridge Energy Research Associates.

"The private economy is a good deal bigger than originally thought. Given the status of the oil industry this could result in a reduction in oil exports," said Yergin.

According to the Russian Fuel and Energy Ministry news agency Infotek, Russian crude oil exports rose 12.8 percent in the first six months of 1994 compared to the first half 1993 levels.

Cash-strapped Russia, once the world's largest oil producer, has been able to boost exports to the West despite a sharp production fall since consumer energy demand inside the former Soviet Union has fallen.