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Three Reasons Russia Wants to Boost Oil Output

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Published: Friday, 12 Sep 2008 | 4:24 PM ET
By: Associated Press

A quick look at key issues behind Russia's effort to increase oil production.

Falling Output: Russia's wells will produce 0.5 percent less oil this year than the 491.5 million tons they did last year, analysts think, although the government is sticking with its forecast of a 1 percent increase. It would be the first decline in a decade. Older fields are producing less and companies are looking for new oil, but that's expensive.

Taxes: The government has already cut taxes on oil companies so they can keep more of what they earn from recent high oil prices and use that money to find more oil. But some think even bigger tax cuts are needed.

Politics: Oil revenues have been key to the career of Prime Minister Vladimir Putin, who before switching from his previous post as president oversaw an economic boom fueled by oil and gas profits.

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A quick look at key issues behind Russia's effort to increase oil production.

   
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