Russian Bear vs. OPEC: A battle of wits!

With the global energy equation undergoing another adjustment-albeit a temporary one-a battle royal seems on the cards. For the first time since the collapse of the Soviet Union, Russia has surpassed Saudi Arabia as the top oil exporter. Exports of crude oil and refined products from Russia have risen to 7.4 million barrels a day in the second quarter of this year, up from 7.25 million in the first quarter, according to the Russian Energy Ministry. Russia

The increase came after the largest Russian producer, Rosneft, began pumping from its new Vankor field in Siberia. Rosneft is not alone in having launched new fields. LUKOIL, its closest peer, has also begun production at the South Khylchuyu deposit while TNK-BP has started the Uvat, Kammenoye and Verkhnechonskoye projects last year. Meanwhile, Saudi shipments fell to about seven million barrels a day, from 7.39 million, according to the International Energy Agency. Under drastic cuts agreed upon by the 12 OPEC members in late 2008, Saudi Arabia was obliged to slash 1.31 million barrels a day from its output.

The emerging scenario is ruffling feathers. There seems a definite distancing between Russia and OPEC, as Moscow seems determined to capitalize on the OPEC output cuts. Speaking after the Vienna ministerial, OPEC Secretary-General Abdullah Al-Badri said he was not encouraged by Russia