CIVIL STRIFE WORSENS U.S.S.R.'S PETROLEUM SITUATION

Jan. 22, 1990
Renewed ethnic violence in Azerbaijan this month dealt another severe blow to the Soviet republic's onshore petroleum industry but initially had little effect on Azerbaijan's offshore oil and gas production. Again, as in the civil turmoil of late 1988, clashes between Azerbaijanis and Armenians in and around Azerbaijan's capital city of Baku disrupted work in the area's big petroleum equipment manufacturing industry, refineries, petrochemical plants, and onshore oil fields.

Renewed ethnic violence in Azerbaijan this month dealt another severe blow to the Soviet republic's onshore petroleum industry but initially had little effect on Azerbaijan's offshore oil and gas production.

Again, as in the civil turmoil of late 1988, clashes between Azerbaijanis and Armenians in and around Azerbaijan's capital city of Baku disrupted work in the area's big petroleum equipment manufacturing industry, refineries, petrochemical plants, and onshore oil fields.

Railroad, highway, and pipeline transportation, as well as refinery production, had not fully recovered from the 1988 riots when the 1990 strife began.

Baku's two main refineries operated substantially below capacity last year not only because of declining Azerbaijani onshore oil production but also because pipeline deliveries of crude from Grozny to the northwest and tanker shipments from Buzachi fields across the Caspian in Kazakhstan were cut sharply.

The Soviet press reported last December that Baku refineries had never experienced such a desperate situation as they did in 1989.

During November, onshore Azerbaijani crude production plummeted to about 56,000 b/d, or less than 65% of official plan. In 1940, when Azerbaijan's entire crude production was from onshore fields, flow was 445,000 b/d- by far the largest for any area in the U.S.S.R.

As late as 1900, Azerbaijan produced more oil than any country in the world.

Offshore Azerbaijan late last year accounted for nearly 79% of the republic's crude and condensate production and considerably more than 90% of its gas flow.

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