Yukos pulls rail supplies to China
OIL jumped towards $46 a barrel today as cash-strapped Yukos shelved a huge portion of its exports to China.
The Russian oil giant had its bank accounts frozen by government bailiffs as the Putin administration conitnues to attempts to get more than $7bn (£3.9bn) in back taxes.
Now Yukos claims it does not have enough money to continue rail exports to China. It uses trains to send 100,000 barrels a day there.
US light crude jumped as high as $45.89 before slipping back to $45.80 - still up 21 cents on the day.
Traders noted any supply concerns in the current tight market would have a massive impact on global prices. But the Yukos decision to shelve rail exports to China could be just the first of many disruptions.
It has repeatedly warned the government's hard-line stance would force it to start reining in supplies.
Dealers are also concerned about disruption to US supplies from the storms buffeting the country. Analysts are particularly concerned Tropical Storm Jeanne may delay imports into the country, which has already run down its stockpiles to six-month lows.
A further two dangerous-looking weather systems behind Jeanne are also causing concern.
