Russian minister casts doubt on charges against Khodorkovsky

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A Russian minister took the witness stand at the trial of jailed oil magnate Mikhail Khodorkovsky on Tuesday and cast doubt on charges that his Yukos oil company had stolen millions of tonnes of oil.

Trade and Industry Minister Viktor Khristenko was the most powerful serving official to testify so far at Khodorkovsky's trial, which is seen as a test of government promises of economic and judicial reform.

Despite being in a key position, Khristenko said he had not been aware of the alleged theft of millions of tonnes of oil that Khodorkovsky is charged with perpetrating.

"Physical stealing of oil from pipelines is a problem that has existed and unfortunately still exists... But I have not heard of millions of tonnes of oil being physically stolen," said Khristenko, who served as a deputy prime minister responsible for fuel and energy and was a member of the board at state pipeline company Transneft during the period covered by the charges.

Khristenko was responding to questioning from Khodorkovsky himself, who is standing trial on fresh charges of embezzling millions of tonnes of oil and laundering the proceeds, while still serving an eight-year prison sentence for fraud.

Responding to questioning about whether it would be physically possible to steal oil from Russian pipes, he said that Transneft was responsible for oil "from the moment it was pumped until its final destination".

Khristenko also said that Yukos along with other oil companies set its own prices for oil and that its practice of buying back oil at low prices from its subsidiaries was not illegal.

Such transfer deals were "not in any way exotic or illegal," he said.

"There were no prices established by the state, either for oil or oil products. There were only market prices and they were established under the influence of vertically integrated oil companies."

He also said that he did not know of any audits of missing oil by Russian state-controlled oil company Rosneft, which acquired Yukos' assets.

"We are satisfied by the answers that we heard from Khristenko," said Konstantin Rivkin, the lawyer for Khodorkovsky's co-defendant, Platon Lebedev.

"I think the changes are not in this trial but in the country, when a civil servant of such a level responds to a court summons and shows citizens a good example."

Defence lawyers have called other prominent figures at the trial, including former prime minister Mikhail Kasyanov and on Monday former economics minister German Gref.

Gref told the court that he also would have known if officials had spotted millions of tonnes of oil going missing.

President Dmitry Medvedev on Friday promised Western investors that his government would continue economic reforms and said he was "truly modernising Russia."

Khodorkovsky calls the charges politically motivated, but the Russian government insists he is guilty of massive financial crimes stemming from Russia's controversial privatisations of the 1990s.

© 2010 AFP

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