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Russia's oil giant Yukos back under state control.

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Russia's oil giant Yukos back under state control.

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The little-known company which bought the main asset of the beleaguered Russian oil firm Yukos has reportedly been sold to state-owned oil giant, Rosneft. The move effectively nationalises 11 percent of the country’s crude output and deals a heavy blow to Yukos’s attempts to halt its own break-up. The Baikal Finance Group was the surprise winner of Sunday’s auction of the Yukos core unit, Yuganskneftegaz.

The sell-off was the culmination of a Kremlin campaign to raise money to cover a huge tax bill owed by the former owner of Yukos, Mikhail Khodorkovsky, who is on trial for fraud and tax evasion. The Rosneft purchase has now underscored Moscow’s determination to claim Yukos’ prize asset for itself and seize control of strategic sectors of the economy sold-off in the chaotic privatisations of the 1990s.