China National Petroleum Corp. (CNPC) was in talks with Yukos to convince the Russian oil supplier to renew needed shipments of crude oil, an executive of China��s State-run oil giant said.

The executive, who spoke on condition of anonymity, said his company had fulfilled all contract terms and hoped to see shipments resumed.

Yukos, Russia��s largest crude producer, confirmed Sunday it was suspending 400,000 metric tons a month, or about 100,000 barrels a day, of rail exports to CNPC due to high shipping costs. That represents about 60 percent of the company��s total China shipments.

A Yukos spokesman in Moscow said the suspension of shipments was provoked by financial reasons. The spokesman did not confirm talks with CNPC, but did say Yukos hoped to eventually resume shipments.

Yukos faces billions of dollars in back tax claims and company officials say it is ��close to bankruptcy.�� Most of its bank accounts and assets have been frozen by the Russian government.

Yukos notified CNPC on Friday that it had stopped loading crude shipments. The last shipment of Yukos crude was due to arrive Sept. 28, the spokesman said.

Analysts have speculated that Yukos timed its move to cancel shipments to coincide with a visit by Chinese Premier Wen Jiabao to Russia, scheduled to start Wednesday.

National Development and Reform Commission Vice Minister Zhang Guobao indicated that Wen may discuss the issue during his visit.

��Let��s wait and see ... since Premier Wen is leaving for Russia,�� Zhang told reporters on the sidelines of an industry conference Monday in Beijing.

Yukos says it plans to continue deliveries to China Petroleum & Chemical Corp., or Sinopec �� another major importer.

In another development, China still expected Russia to increase its crude oil shipments despite the decision by Yukos to suspend some deliveries, Foreign Ministry spokesman Kong Quan said Tuesday.

Asked if the decision by Yukos to suspend oil deliveries to CNPC would be on the agenda for talks during Premier Wen Jiabao��s visit to Russia, Kong said oil and energy cooperation between the two countries would surely be included in the discussions.

Russia and China agreed during a recent energy summit to expand cooperation, especially in the area of oil, Kong told a regular news briefing. 

Source: Shenzhen Daily-Agencies