Russian Oil Czar Reluctant to Change Buyout Offer

The Wall Street Journal       Gregory L. WHITE

Beyond his official post as chief executive of state oil company OAO Rosneft, Igor Sechin is a longtime confidant of President Vladimir Putin and widely seen as one of the most powerful people in Russia. So when his PR staff called the top editors of most of the country’s major newspapers late Friday night to summon them to an urgent briefing with him the next day, nearly all turned up.

But Mr. Sechin didn’t gather them at Rosneft headquarters in downtown Moscow to announce a new multi-billion-dollar deal with a global oil major or another giant project with customers in China. No, the reason he brought the editors, including two foreigners, out of bed on a Saturday morning was to respond to a complaint voiced a few days before by a small shareholder in one of Rosneft’s many subsidiaries.

Over the following two hours, ignoring the plates of fruit and Russian blini laid on the table, Mr. Sechin provided a window into the mindset of the man who runs the world’s largest publicly traded oil company by production.

He seemed less concerned about the substance of the shareholder’s complaint–the fund manager voiced a concern widely held in the market that Rosneft’s offer to buy out minorities was unfairly low–than the fact that the investor had taken it directly to Mr. Putin during a public question-and-answer session at an investment conference.

“This was an attempt to apply pressure, maybe even to manipulate the market,” Mr. Sechin said of the fund manager’s question to the president.

U.S. Is Overtaking Russia as Largest Oil-and-Gas Producer

Photo: AFP

The Wall Street Journal              
Russel GOLD  and Daniel GILBERT 

The U.S. is overtaking Russia as the world's largest producer of oil and natural gas, a startling shift that is reshaping markets and eroding the clout of traditional energy-rich nations.

U.S. energy output has been surging in recent years, a comeback fueled by shale-rock formations of oil and natural gas that was unimaginable a decade ago. A Wall Street Journal analysis of global data shows that the U.S. is on track to pass Russia as the world's largest producer of oil and gas combined this year—if it hasn't already.

The U.S. ascendance comes as Russia has struggled to maintain its energy output and has yet to embrace technologies such as hydraulic fracturing that have boosted American reserves.

"This is a remarkable turn of events," said Adam Sieminski, head of the U.S. Energy Information Administration. "This is a new era of thinking about market conditions, and opportunities created by these conditions, that you wouldn't in a million years have dreamed about."