| MOSCOW, Sept. 27 - Energy executives and government
officials from Russia
and the United States will meet in Houston next week to discuss
energy
cooperation at a time when concerns over the safety of world oil
supplies
have been heightened by the Bush administration's push for action
against
Iraq.
The conference is expected to include a who's who of leaders
of the Russian
oil industry as well as executives from American energy companies.
The
secretary of commerce, Donald L. Evans, and the secretary of the
Treasury,
Paul H. O'Neill, are also scheduled to take part.
The conference, a product of the summit meeting between President
Bush and
President Putin in May, was originally seen as a step to cement
the new
relationship between the countries after the terror attacks of
Sept. 11.
But it has taken on added significance since, as the
United States seeks
international support for a drive to oust Iraq's president, Saddam
Hussein.
Those efforts have set oil markets on edge: crude prices have
risen 27
percent since mid-June. And the possibility of warfare that could
disrupt
oil supplies from the
Persian Gulf has thrown a spotlight on the growing
importance of Russian oil.
The Russian companies say they will use the conference to propose
projects
that would bring more Russian oil more rapidly to world markets,
especially
the
United States. Right now, almost the only export routes open to
substantial shipments of Russian oil lead to Western Europe.
"The whole idea is to see whether
Russia can become a marketer and a
supplier of crude oil to the U.S.," said Simon Kukes, president
of Tyumen
Oil, Russia's fourth-largest producer. "It could reduce reliance
of the
U.S. on OPEC and lead to more stability in supply."
American officials have frequently mentioned
Russia as a growing world
energy supplier, as tensions have risen in the Middle East. Russian
output
has grown by about 7 percent annually in recent years, and now
stands at
7.7 million barrels a day, comparable to that of Saudi Arabia,
though
Russia consumes about half of its production domestically.
Speaking to reporters by telephone on Thursday, Mr. Evans said
Russia was
"a major contributor to the global energy supply, and I expect
it to grow."
Mr. Evans would not say whether Russian business interests in
Iraq would be
a topic at the conference. But Russian companies say it ought
to be. Russia
has been one of Iraq's biggest trading partners since the United
Nations
allowed Iraq to start trading oil for food in 1996. Russian companies
want
assurances from Washington that an American-backed post-Hussein
government
will honor their contracts with the current regime.
"Everyone is just marking off their territory," said
one influential
Russian businessman, referring to Russian companies in
Iraq. "It's a smart
strategy - signing contracts to get a head start."
Even so, few people here are confident that Russian companies
will be able
to return to choice projects in
Iraq quickly after military action.
"No one here believes that the Americans will be able to
install relative
order soon," said Sergei Karaganov, the chairman of the board
of the
Council on Foreign and Defense Policy. "Very few people here
are
pro-Hussein. He is seen as a dictator and dangerous. But the cure
looks
more dangerous than the sickness."
Russian companies have said they can supply 10 percent of the
United
States' demand for imported crude, a figure many analysts dismiss
as too
optimistic. Indeed, most oil analysts say Russian exports could
not offset
a major disruption in flows from the Middle East, by far the world's
largest oil-producing region.
Still, Russian output is growing, and companies need new markets
since
demand is stagnant in their existing markets in
Europe.
The Russian industry hopes to reach 9.5 million barrels a day
by 2010, and
will need to expand export facilities extensively to handle the
oil. The
cramped pipeline network will have to be expanded, and new deepwater
ports
built to accommodate the supertankers used in the trans-Atlantic
oil trade.
The Russian oil companies, led by Lukoil, the biggest producer,
will tell
the conference of a plan to build 930 miles of pipeline and new
loading
facilities in the northern port city of
Murmansk as a new route for exports
to North America.
"American companies could supply services and equipment
and share financing
costs for this project," said Gennady Krasovsky, a Lukoil
spokesman. "This
pipeline means more supplies for American consumers, and gives
Russia more
outlets for its crude."
But the
Murmansk project will take years to complete, according to Mr.
Kukes, who has called for more immediate steps. He said that international
commodity exchanges could help by listing prices for Russia's
benchmark oil
grade, known as Urals (after the Russian mountain range), and
the United
States could help by leasing international oil storage facilities
to
Russian oil companies.
Russian politicians have applauded the new energy rapport between
Moscow
and Washington as a counterweight to OPEC. Russia is not a member
of the
cartel, and has sometimes defied the cartel's demands that it
limit its
exports in the interest of higher prices.
"The ultimate goal of American and Russian energy cooperation
is tearing
down the OPEC monopoly," Grigory A. Yavlinsky, the leader
of the liberal
Yabloko Party, said in an interview. It will, he said, "take
away the stick
that they are using to terrorize everyone."
Russia's energy sector has only begun to attract a flow of foreign
investment after years of unstable economics and bureaucratic
hurdles, and
there are few signs that major commercial deals will be struck
at the
conference. But the interest level is rising on both sides.
ChevronTexaco's chief executive, David O'Reilly, was in Moscow
this week to
survey energy opportunities in Russia. A spokesman for Russia's
energy
minister said ChevronTexaco had been invited to participate in
developing
new reserves in Eastern Siberia and the Russian Far East.
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