New Horizons in International Business series
By 2007 the Russian oil landscape had changed radically from the situation described in Chapter 2. By May 2007, the last Yukos asset had been transferred to the state, transforming Rosneft, the state-controlled oil company, from Russia’s number 8 oil producer, worth $6 billion, to the country’s largest producer with a market capitalisation of $90 billion. The acquisition of Sibneft, one of the ﬁve integrated oil majors, by Gazprom, the state gas company, had also propelled Gazprom into the oil business. By January 2007, Gazprom was number 2 behind ExxonMobil in terms of market capitalisation rankings for energy companies and Rosneft had appeared in the rankings at number 13. Lukoil and Surgutneftegaz were at 16 and 17 respectively (PFC Energy, 2007). Both Rosneft and Gazprom are heavily inﬂuenced by President Putin. Rosneft is chaired by Igor Sechin, Putin’s deputy chief of staﬀ and one of the Kremlin insiders. Gazprom is chaired by Dmitry Medvedev, ﬁrst deputy prime minister and one of Putin’s colleagues from St Petersburg. TNK-BP has also not escaped the growing inﬂuence of the state – it was obliged to sell its majority stake in the Kovytka gas ﬁeld to Gazprom, because it had failed to meet the production quotas stipulated by the licence. However, it had been unable to meet production quotas because of Gazprom’s refusal to develop an export pipeline. In the meantime, although Russian oil production has continued to rise (Figure PS.1), growth rates have declined (Figure PS.2). Output growth for the industry was...
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