Bloomberg News

Russia Considers Delay of Sovcomflot Stake Sale, Nabiullina Says

March 29, 2012

Russia may delay the sale of a stake in OAO Sovcomflot, owner of the world’s largest number of tankers, after overcapacity in the freight market drove down shipping rates and squeezed valuations last year.

“Sovcomflot might be sold this year or the deadline could be reconsidered,” Economy Minister Elvira Nabiullina said in an interview today in New Delhi. “We will look at the state of the freight market.”

In February, Nabiullina said there was no reason to delay the privatization of a stake in Sovcomflot, which is wholly owned by the Russian government.

Global shipping markets have slumped as the fleet grows faster than oil demand. The Baltic Dirty Tanker Index, a gauge of costs to hire crude-oil tankers on 12 maritime routes, fell 62 percent since the end of 2007, according to the London-based Baltic Exchange.

Russia may start selling its holdings in energy companies including OAO Rosneft, OAO RusHydro and Federal Grid Co. this year, Nabiullina said.

To contact the reporter on this story: Ilya Arkhipov in New Delhi at iarkhipov@bloomberg.net

To contact the editor responsible for this story: Brad Cook at bcook7@bloomberg.net


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