Severodvinsk (Russia): Russian Prime Minister Vladimir Putin today expressed concern over the country's declining oil production and said the sector was at a "critical juncture".

Putin also said, however, that Russia would not engage in "economic egoism" and would continue to fulfill export contracts even as it met the energy needs of its own growing economy.

"The prospects are good but some tendencies worry us. The rate of growth of production has gone down ... In the first quarter of this year, production even declined 0.3 per cent," Putin told ministers and oil executives.

"The oil sector has reached a critical juncture," Putin said after visiting the Sevmash shipyard in Severodvinsk where Russia s first Arctic oil rig is under construction.

He said tax cuts approved this year had already given oil companies more money to spend on development and added that the government was considering additional tax breaks for companies operating in oil-rich regions of Siberia.

The government will also ease bureaucracy for companies opening new oil fields and develop infrastructure in remote areas to encourage investment.

"Our energy policy will be clear, transparent, liberal. We do not plan any economic egoism. We will take into account the legitimate interests of our partners but we will also defend our national interests," he added.

"We have no doubt that now, in the medium-term and in the long-term, we will completely cover the growing demand of the Russian economy and fulfil our obligations to our foreign partners," he continued.

Russia is the world s second largest producer of oil after Saudi Arabia but the country has struggled to boost production to meet growing global demand despite record-high oil prices.

Source : PTI