So how does Russia increase their oil exports out of Primorsk by 50 million tons in the short term? Everyone has their eyes on the pipelines and the pipeline capacity just isn’t on-line yet and could take a year or two of construction. There’s one guy in Russia who is getting mentioned as Putin’s possible replacement and he comes from an industry that would be very overlooked by Washington. Russia’s state owned Russian Railway's is run by Vladimir Yakunin and like Vladimir Putin, is a former KGB agent. Yakunin was included in Russia’s recent high-level trip to the Middle East, now why is a railroad guy going to the Middle East? When you look at the big picture everything that needs to occur this year and next is going to have to transit across Russian rail. In order for Russia’s oil exports to increase by 60% to China this year, Russia’s rail system is going to be the determining factor. In order for South Korea to firmly join the BRIC alliance, South Korean goods are going to have to transit across Russia’s Siberian Railroad. It should come as no surprise that North Korea is giving up their nuclear capabilities in order to profit from this expected huge boost to trade. In order for Russia to break the D0llar link to oil, Russian exports of crude out of Primorsk need to grow by a million barrels per day and that just isn’t going to happen without Russian Railway.

Russia’s oil exports out of Primorsk really need to be running at about 4 million barrels per day in order for Russia to have enough capacity to meet current commitments plus close down the Druzhba pipeline that transits 1.6 million barrels per day of crude selling in d0llars across Poland to Germany. This would deny Poland their much needed d0llar generator that funds much of Poland’s over $100 billion of external debt, plus their current account deficit and their national account deficit. With Poland’s recent decision to be the home of the hegemon’s missile defense shield it makes absolutely no sense for Russia to be funding Poland’s economy. Without current pipeline capacity to reach Primorsk, there is only one way to increase shipments and that’s to utilize Russian rail.

From a historical perspective it was Rockefeller’s control over the rail lines that created the monopoly of Standard Oil and it’s subsequent break-up into the Seven Sisters. Seems all too fitting that in this 21st Century Information Age it will be the railroad once again that is the Seven Sisters undoing from a virtually unknown figure Vladimir Yakunin at the helm. Railroad Tycoon’s it would appear are about to make a comeback.

Here’s a recent article regarding Russian Railway

State-owned Russian Railways plans to attract about $9 billion in investment next year

State-owned Russian Railways plans to attract about $9 billion in investment next year, 20% more than in 2006, the company's president said Monday. This year's investment in the rail network is expected to total $6.65 billion, of which $6.60 billion will be Russian Railways' own funds, the company said earlier.

"Next year, according to macroeconomic forecasts, we will have to increase cargo traffic by 3.5% and passenger traffic by 2.7%; this will be achieved primarily by efficient use of trains and capital investment," Vladimir Yakunin told an end-of-year meeting of the company's management. Yakunin said that in 2007 the company would launch a two-year investment program, which had been approved by the government.

Russian Railways will also start a series of projects, including the reconstruction of a northwestern railroad and of rail approaches to ports in the southern part of the Gulf of Finland, which will altogether provide a shorter and cheaper rail link for exports from major cargo hubs.

"In 2007, the company will substantially expand acquisition of rolling stock, in particular freight carriages," Yakunin said.

The Russian Railways president said the company's investment program for 2006 had attained the declared objectives of increasing traffic, cutting maintenance costs, developing an IT-based logistics system, and introducing resource-saving technologies.

Link

With so much at stake this year in the fight against the d0llar Hegemon it seems to me that you put the guy with the knowledge of how best to do this in the Presidency of Russia. Don’t overlook Vladimir Yakunin when the time comes for Putin to pick his successor, way too much is riding on Russian Railway. We've got about 4 to 6 weeks left of winter weather in the Gulf of Finland before exports can really start to take off, we'll soon see what happens. Peace.