Crude oil may reach a record high this week amid concerns the Russian Government's dispute with OAO Yukos, the nation's biggest exporter of the fuel, will disrupt shipments, a Bloomberg survey of traders and analysts shows.

Sixteen of 31 survey respondents, or 52 per cent, predicted that oil futures in New York would rise. Five said the price may be little changed and 10 forecast a decline.

A week ago, 37 per cent of respondents expected a decline. Futures gained 0.3 per cent last week through Thursday.

Yukos said the Russian Government's plan to seize its main Siberian oil business to pay a US$3.4 billion tax bill could bankrupt the company, cutting exports because of an inability to pay transport contractors.

Organization of Petroleum Exporting Countries (OPEC) members are producing near capacity, leaving little excess as a cushion in case of supply cuts.

"Crude will likely test or take out the high" of US$42.45 a barrel on June 2, said Tom Bentz, an oil broker at BNP Paribas Commodity Futures Inc in New York.

OPEC's efforts to ease prices have not prevented recent gains, Bentz said.

Crude oil for September delivery last Thursday rose by 78 US cents, or 1.9 per cent, to settle at US$41.36 a barrel on the New York Mercantile Exchange. Prices have climbed by 16 per cent in three weeks. Oil was little changed in after-hours electronic trading at 12:39 pm in Singapore on Friday.

Bloomberg's oil market sentiment survey has forecast a price decline in each of the past seven weeks. Damage to a pipeline that disrupted Iraq's exports, a strike that shut some Norwegian production and the Yukos dispute have contributed to price rises.

Yukos said it may run out of cash in three weeks. The business the Russian Government plans to seize, known as Yuganskneftegaz, pumps 1 million barrels of oil a day, equal to the amount produced by OPEC member Indonesia.

"Yukos is a big problem," said Phil Flynn, senior energy trader for Alaron Trading Corp in Chicago. "One million to 1.7 million barrels a day are at risk of being taken off the market when OPEC is saying we don't have the excess capacity."

Oil futures have closed above US$40 per barrel in the past seven trading sessions, the longest stretch above that level since an eight-session run that started May 11.

"With Yukos facing possible bankruptcy, speculators are again adding length in crude oil," said Marshall Steeves, an analyst with Refco Inc in New York. Length refers to bets that prices will increase.

The Russian Government has conducted a year-long probe into Yukos and its biggest shareholder, Mikhail Khodorkovsky, who is in jail. Russia and Saudi Arabia are the world's biggest oil producers.

"Where we are headed pretty much is for the government to appropriate the assets from a private company that by Western standards was fairly transparent and well-run," said Subash Chandra, an analyst at broker Morgan Keegan & Co in Houston.

OPEC agreed earlier this month to proceed with a plan to boost its output quotas, starting on August 1. Members already are producing above their limits.

With the exception of Iraq, the 10 OPEC members are producing about 2 million barrels a day above their combined target, the group's president, Purnomo Yusgiantoro, said on Thursday.

OPEC supplies more than a third of the world's oil.

(China Daily 07/26/2004 page11)