OREANDA-NEWS. On November 06, 2007 Russia's Federal Tariff Service has received a letter of request from Transneft to have its oil transportation tariff indexed in 2008, said Denis Volkov, head of the federal service's oil and gas industry regulation department, adding that the rate of increase would be determined by the end of the following week.

Meanwhile, Federal Tariff Service sources revealed that, according to preliminary calculations, the tariff would be hiked by between 11 and 12 percent.

The bulk of the sum received from the tariff rise is expected to go towards paying interest on loans raised for the construction of the Eastern Siberia - Pacific Ocean pipeline. Transneft's pipeline tariff was last raised by 8.7 percent on January 1, 2007. Experts do not consider the proposed 11-percent increase significant, as oil prices spiked by a wider margin, and because this rate is comparable to this year's inflation. This also means that Transneft is managing to keep its operating costs under tight control.