Russia to abandon OPEC deal

Russian tankers prepare to abandon export curbs

MOSCOW, Russia -- Russia, the world's second-largest oil exporter, plans to abandon oil export curbs agreed with OPEC over the next two months.

Russia had agreed to cut oil exports by 150,000 barrels a day from an October peak to back attempts by the Organization of the Petroleum Exporting Countries to bolster flagging oil prices.

Oil prices have risen more than a third this year, after declining about 20 percent in 2001.

The decision to remove the quotas should enable Russian oil companies to boost profits. The Russian companies are owned by investors, while Middle Eastern oil companies are government owned.

MORE STORIES • How crude oil hits the consumer  • OPEC agrees oil cut  • Russia to cut oil exports  • Russian oil industry roaring back

Brent Crude for July delivery was trading at $26.18 a barrel in London midday on Friday, down 20 cent after the Russian decision.

"According to the mutual opinion of the government and oil firms, stabilisation of the market is already close,'' Prime Minister Mikhail Kasyanov said after meeting executives from Lukoil, Yukos Oil and other producers.

"In this context we have come to the conclusion that it is time to gradually abandon the reduction that Russia applied to its oil exports,'' he said.

"That means we will return to our normal volumes of oil output and exports to international markets over the next two months.''

Russia joined other major non-OPEC producers Norway and Mexico and agreed to cut oil exports by around 5 percent, or 150,000 barrels per day, from January-June.

OPEC had threatened to flood the market had Russia not joined the concerted effort to boost oil prices amid concerns a global economic slowdown and recession in key economies -- the United States, Japan and Germany -- would lead to a fall in demand.