Government, Big Oil Companies Agree on Export Duty Cuts

Oil export duties in Russia will be gradually cut to zero over six years, according to a new agreement between Russia’s finance and energy ministries and its main oil companies, Reuters reported.

Two government sources told the news agency on Wednesday that the agreement was made at a special meeting to discuss the matter. The oil export duty, which is now 30 percent, will be lowered by 5 percentage points every year till 2024 as part of the reform, the sources said after Wednesday’s meeting.

Russian officials have long been at odds over how to apply a planned new tax regime to replace oil export duties and a mineral extraction tax linked to the oil price with a single profits-based tax.

A spokesman for Deputy Prime Minister Dmitry Kozak, who chaired the meeting, declined to comment. So did the finance ministry, the energy ministry, Rosneft and Lukoil. Gazprom Neft was not available for immediate comments.

Alexey Sazanov, the head of the tax department in the finance ministry, told Reuters last month that the ministry had floated an idea to lower export duty to zero over five or six years.