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US dismayed by Moscow moves on Yukos

US dismayed by Moscow moves on Yukos
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The United States has voiced concern over the Kremlin’s takeover of the core unit of Russian oil company, Yukos. The US State Department says handling of the case has not been transparent and that sends a wrong signal to foreign investors, which could affect Russia’s role in the global economy. State-owned outfit Rosneft bought Yukos’s key production unit, Yuganskneftegaz from Baikal Finance group – a previously unknown shell firm that was the successful bidder in an auction organised by the government to collect back taxes from Yukos.

Russian President Vladimir Putin defended Moscow’s action. “Everything was done within the framework of market rules,” he said. “All state companies which are 100 percent owned by the state can, like any other company, participate in this kind of auction. They just exercised their own right,” he added.

The move is one of the most decisive interventions by the Kremlin in business affairs since the fall of the Soviet Union. It may put Yugansk’s assets beyond the reach of Yukos’s lawyers who are trying to halt the piecemeal destruction of the company. They say the firm is being punished because of its outspoken owner, Mikhail Khodorkovsy, who is in jail charged with tax evasion and fraud.

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