Russia-U.S. oil partnership off fast track (pipeline dead -US Oil angry)

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Russia-U.S. oil partnership off fast track -Less than 2 years after a `historic' delivery of Siberian crude arrived in Houston, analysts say all signs point to Moscow's fading interest


By Alex Rodriguez
Tribune foreign correspondent

March 1, 2004

MOSCOW -- As the Russian supertanker Astro Lupus pulled into Houston's port on July 3, 2002, a clutch of Washington bureaucrats and lawmakers was on hand to ensure it would be greeted with pomp and camera crews.

Russian oil was being delivered to an American port for the first time, buoying the Bush administration's hopes for a new partnership with Russia that would reduce U.S. reliance on Middle Eastern oil. Washington called the delivery "historic." A headline in a Russian newspaper screamed: "America, accept this gift from Siberia!" Today, analysts and U.S. officials see hopes for such a partnership fading fast.<snip>

Russia's ambitious plans for a (2 million barrels of oil a day, $4.5 billion) pipeline to pump Siberian oil to the (deep-water, ice-free) Barents Sea port of Murmansk so it could be shipped directly to the United States have gone nowhere. The project, a senior U.S. diplomat , is "key to expanding oil to North American markets."

Western oil corporations have poured billions of dollars into developing vast, untapped Russian oil reserves. But in January, the Russian government nullified ExxonMobil's rights to explore a major oil field off Sakhalin Island, a move that one American business leader in Moscow called "expropriation."<snip>

"Russia's desire to have more control over the Sakhalin projects has begun to weigh on Putin," said William Ratliff, an international affairs analyst with Stanford University's Hoover Institution. "Now he's thinking he has allowed too much freedom for foreign investors there and he's going to have to rein that in a bit."<snip>