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. Last Updated: 07/27/2016

Yukos Tells OPEC Its Glory Days Are Over

OPEC on Tuesday reiterated its confidence that Russia will continue maintaining a curb on crude exports, while Russia's most celebrated oil executive lashed out at the cartel in the international press.

After talks with Energy Minister Igor Yusufov in Moscow, Venezuelan Energy and Mines Minister Alvaro Silva said he was "sure" Russia would extend its quota on crude exports into the second quarter. Venezuela is one of the 11 countries that form the Organization of the Petroleum Exporting Countries.

"We are optimistic that Russia will continue its cooperation after the beginning of April," Silva told reporters.

Silva and OPEC, however, will be disappointed if Mikhail Khodorkovsky gets his way. In a commentary published in the Financial Times on Tuesday, the Yukos chief urged the government to "act with determination and decisiveness and say no to OPEC's demands."

Khodorkovsky said the cartel -- created to bring stability to oil's spot markets -- has brought increased volatility.

"OPEC has to accept that its 1970s and 1980s heyday is over," he said, adding that although Russia and OPEC have so far avoided an all-out war over market share, a conflict is imminent.

"OPEC and Russia have so far avoided a dispute," he said. "But [Russia] will surely not be able to prevent one for long. It will remain like this as long as OPEC assumes that it can continue to act as producer, exporter and global regulator all in one."

Last December, the world's top oil exporters that are not members of OPEC -- including Russia, Norway and Oman -- agreed to help the cartel prop up prices by cutting combined exports by 500,000 barrels per day.

After a war of words with OPEC ministers that sent oil prices tumbling on fears of crude oversupply, Russia relented and agreed to a 150,000 bpd cut.

OPEC leaders have been trickling through Moscow during the past month, trying to drum up support ahead of a cartel meeting scheduled for Friday. OPEC cut supplies by 1.5 million bpd as of Jan. 1, and a decision to extend the cut at least until July is expected at the cartel's meeting in Vienna on Friday.

The nation's oil majors disagree on what course Russia -- the world's second-largest producer of oil -- should take. Companies with high growth rates -- such as No. 2 Yukos and No. 6 Sibneft -- are lobbying against an extension of the export quotas. No. 1 LUKoil, however, has kept quiet. With a slower growth rate and a significant amount of production located outside of Russia, LUKoil has less to lose.

Either way, Russia may already be ignoring the cartel's demands in practice.

Russia's overall crude output is predicted to reach 7.23 million bpd by the end of this year, which would be an increase of 4 percent from 2001.

And according to a report released by energy watchdog the International Energy Agency on Tuesday, exports of crude oil, natural gas liquids and refined oil products from Russia, Kazakhstan, Azerbaijan and Turkmenistan rose by 270,000 bpd to 5.08 million bpd last month -- the second-highest amount since the early 1990s.

The IEA did not publish a separate report for Russia, and OPEC does not attempt to control exports of products.