Soviet oil exports dropped nearly 10 percent last year, figures provided by the Central Intelligence Agency show, raising concerns about domestic oil shortages and cuts in supply to Eastern Europe.
The export drop reflected a decline in oil production caused by aging wells, labor unrest and bureaucratic chaos, U.S. officials said late last week.The Soviet Union exported 3.69 million barrels of oil a day in 1989, down
from 4.08 million barrels a day in 1988, according to the newly compiled CIA figures.
The decline matches the drop in oil production, although the Soviet Union is still the world's largest oil producer, pumping roughly 12 million b/d. Most of its oil is used at home.
The export cuts were made in Soviet sales to Western Europe, surprising analysts who believed the Kremlin was so strapped for cash that it would have reduced supplies to Eastern Europe, which pays for Soviet oil with goods, not money.
So far this year, the Soviets have sharply cut supplies to their onetime Communist allies in Eastern Europe, but they have promised to make up the shortfall by summer.
U.S. government officials are uncertain whether this year's drop foretells a dramatic interruption in supplies to Eastern Europe, or whether such temporary cutoffs previously happened frequently but were unreported by the former secretive Communist governments of the Soviet bloc.
The U.S. officials predict a further decline in Soviet production unless the Kremlin opens the door to foreign investment in offshore drilling and in technology to salvage wells damaged by years of forced production in western Siberia and other regions.
"Without Western assistance, production will probably decline dramatically," said one U.S. official, who spoke on condition of anonymity.
U.S. companies are eager to sell their technology and know-how to the Soviets, but most are put off by bureaucratic red tape and by the difficulty of converting profits in rubles into dollars.
Furthermore, U.S. and other companies are concerned about making deals with the Soviet Ministry of Petroleum and Gas Industry, which has undergone several reorganizations in the past year as the Kremlin struggles with economic reforms.
U.S. officials say Leonid Filimonov, in charge of the ministry, may lose his job this summer.
Analysts and government officials attribute the Soviet problems to aging oil fields that no longer yield as much as before, wells that became waterlogged because the Soviets wanted to increase production by forcibly injecting them with water and a lack of funds for the technology needed to explore new offshore and Arctic Circle fields.
In addition, the new openness in the Soviet Union has spawned labor unrest as oil field workers demand better living conditions.
Ethnic unrest in several Soviet republics, especially Azerbaijan, has cut into the production of oil and natural gas equipment, officials say.
U.S. officials are divided, however, on whether the reduction in Soviet exports will come at the expense of the Kremlin's newly democratic clients in Eastern Europe.
The Soviet government announced several months ago that starting in 1991 it would sell oil only for cash.
Eastern Europe, heavily indebted and trying to move from a communist to a free-market economy, relies on the Soviets for 70 percent of its oil.
"Faced with a very difficult choice of paying in valuable and scarce hard currency for their previously subsidized oil and gas imports from Moscow or buying those supplies" from other sources, Hungary, Poland and Romania probably will opt for increasing their trade with Middle Eastern oil exporters, wrote Robert Copaken, a senior political economist at the Department of Energy.
The Eastern Europeans could pay for the oil with goods they produce, although these traditionally have been too low in quality to compete effectively with Western goods, Mr. Copaken wrote in the June issue of the East-West Report, a newsletter.
But a U.S. government official, speaking on condition he not be named, predicted that Eastern Europe probably can continue to rely on Soviet oil supplies in the short term.
Eastern Europeans might work out an agreement whereby they will barter goods for oil at real market prices, rather than the heavily subsidized and unrealistic prices both sides enjoyed in the past, he said.