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IPFS News Link • Russia

The Battle To Control Russia's Pipelines

• https://www.zerohedge.com, by Viktor Katona

To a significant degree, this was the result of U.S./EU sanctions which have indiscriminately left all major oil companies in a somewhat constrained position. This meant they would cooperate much more willingly against external pressure rather than bickering amongst themselves. Yet events unfolding in the past few weeks point to the possibility of a clash between ministerial offices in lengthy judicial battles. Rosneft is, as usual, involved in these developments, while Transneft is on the other side of the court.

First let's analyze the two companies involved. Both are under the control of the Russian government – albeit to a different extent (the Russian state owns 78.55 percent of Transneft and 50 percent + 1 share of Rosneft). Both are controlled by people quite close to the Russian President Vladimir Putin, therefore, at least in principle, should count as equidistant to political decision-making authorities. Yet the similarities pretty much end there – Transneft's actions are controlled and dictated by the Anti-Monopoly Service, whilst Rosneft can act freely, be it in cases of investing in a new endeavor or crashing the Russian ruble with one of its currency machinations. Controlling 46 of Russian crude production (as of December 2018), Rosneft is by far the most newsworthy Russian company, to put it mildly.

The first official shot in the Rosneft-Transneft standoff was fired in early 2017 when Rosneft and its newly acquired subsidiary Bashneft filed a claim against Transneft for process losses during pipeline transportation. In it, Rosneft stated that up to 0.7 million tons of crude were illegally misappropriated by Transneft – although other producers were roughly on equal footing and lost 0.13-0.15 percent of the crude transported, no one apart from Rosneft took the issue to court.


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