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. Last Updated: 07/27/2016

Fradkov: Chinese Oil Exports Safe

MTPrime Minister Mikhail Fradkov
Prime Minister Mikhail Fradkov pledged Friday that Russia would keep meeting its oil export commitments to China, an apparent reference to fears that a cut in production at the beleaguered Yukos oil company could harm Beijing.

"There are no reasons for any emergency," Fradkov was quoted by Interfax as saying. "Oil products will keep going to China the way they have been."

Yukos sends about 124,000 barrels of crude every day by rail to China, which is already the world's No. 3 oil importer. Earlier this month, Russian railway officials said they were told by China that it would cover Yukos' rail fees if the oil company became unable to cover the transport costs.

Fradkov did not address Yukos directly in his comments.

Yukos is struggling to pay a potentially crippling 99.4 billion ruble ($3.4 billion) back-taxes bill for 2000. It faces a similar claim for 2001, and the total claims against it for the period 2000 to 2003 are expected to swell to some $10 billion.

Former Yukos CEO Mikhail Khodorkovsky is also on trial on charges including fraud and tax evasion, in what is widely seen as a Kremlin-backed campaign of punishment for his growing clout. Khodorkovsky helped finance political parties and had challenged Kremlin policy as head of Yukos.

The Yukos affair has drawn concern from foreign governments, and it has also added uncertainty to the oil market amid warnings by Yukos that it might have to cut back production.