Yukos shares drop on new tax bill

Yukos shares have lost four-fifths of their value in a year

Shares in Russian oil giant Yukos have fallen by 17.5% after the government hit the company with a fresh back-tax bill of $10bn (£5.6bn).

The higher-than-predicted demand for 2002 is the latest twist in a crackdown on Russia's biggest oil producer.

The firm now faces a total of $14bn in outstanding tax demands. It has already paid $3.5bn for the 2000 period.

Fears of an output fall in Russia, amid concerns over the future of Yukos, have helped push oil prices to recent highs.

Siberian unit

On Tuesday, Yukos' dollar-denominated shares, widely held by foreign investors, dropped 17.5% to $3.3 on the RTS stock exchange.

Its rouble shares, traded on the Micex exchange, dropped 11% to 94.30 roubles ($3.28).

Even before the fresh $10bn demand, it was widely thought Yukos would have little option but to sell key Siberian oil unit Yuganskneftegas, which accounts for about 62% of its output, in order to settle its tax bill.

The government's aggressive scrutiny of Yukos' tax affairs is seen by some commentators as a politically-motivated response to the political ambitions of its former chief executive, Mikhail Khodorkovsky.

Output dips

Meanwhile, Russian energy ministry data released on Tuesday showed that Yukos's production output fell slightly in October.

The firm produced 1.73 million barrels per day compared with 1.74 million in September.

Overall, Russia produced 9.41 million barrels of oil per day in October compared to the record-breaking 9.42 million barrels per day the previous month.

But pipeline exports rose by 6% in October, boosted by the launch of a new pipeline to Ukraine.