Interfax's Interview

            The diplomat was skeptical about allegations that Russia might use its energy supplies as a means to exert political influence on its neighbors, particularly the Czech Republic, Poland, and Lithuania.

            "When I was posted in Brussels I did hear a lot not just from them, but from our ambassadors in these countries, more a fear I think than a reality," he said.

            "I don't think we have said either that Russia used its energy resources as a political tool, but one thing for sure to make sure that couldn't happen is to work with Russia to expand its supply," he said.

            "As I say, the best way to deal with it is to have an expanding pie, and it's hard to threaten someone if you are growing. That is I think the best remedy for this concern on the part of these countries for what might happen, and as I say the best way to make sure it never does or could is to see that Russia manages its own resources with the greatest efficiency and transparency," he said.

            Making sure that Russia's oil production grows is among the priorities of energy cooperation between the U.S. and Russia, he said. 

            "One of them [priorities] is to make sure that Russian production grows rather than contracts. There is a lot of concern in the U.S. as there is in Europe that oil production has peaked and will be going down without any major new investment," he said.

            The same is true as regards natural gas, Gray said.

            "This does not affect the U.S. directly, as we are not a consumer. I think we'd like to be in the future [], but we are not now consumers of Russian gas and oil," he said.

            "We are not directly engaged in this. Our companies are, of course, but as a country we are not direct consumers the way Europeans are," he said.

            "We would like to see and we hope that these opportunities are continually made available and that Russia will grow rather than contract in terms of where you can supply our friends in Europe," he said.

            Gray said also that the U.S. was against the idea of setting up a gas cartel similar to OPEC.

            "We are not in favor of cartels of any kind," Gray said.

            "I have been told [and] taught for some time that natural gas is not a natural product for such a cartel like [an] entity in part because it's not yet a fungible commodity. I've been in Qatar where they are quite explicit - the Qataris are - because of the long-term nature of these fixed contracts and the relevant absence of a spot market for LNG that it would be some time, quite some years, before such a cartel would even be possible, and I think that one of the problems with some of the gas relations in Europe is that the contracts may be sort of too long, too foreclosing for readjustment. And so I just don't see it in the short term," Gray said.

            "We would not support it. We are a big producer of natural gas. We in the U.S., it's mostly of course for our own consumption, but our production has stayed pretty even, even though our oil production has declined, and our gas is hanging in there, as we say in America, but even so I don't think we would welcome any such idea," he said.

            On the conflict with TNK-BP Gray said that the United States is concerned by the situation surrounding TNK-BP after its chief Robert Dudley was not issued a Russian work visa.

            We are concerned by the restrictions that are being imposed on his [Dudley's] ability to perform his duties here, in Russia, he said.

            We are not clear what exactly is happening, but we hope that this very successful company will continue its activities, said Gray, who met in Moscow with representatives from the Russian governmental and private sectors to discuss energy cooperation.

            Washington is following the situation and is familiar with it, he said.

            Yes, Dudley is a U.S. citizen and previously worked for AMOCO. He became part of the BP family after BP bought AMOCO, Gray said.

            Hopefully, this very successful company will continue its activities. Over the past six years it has been among Russia's top taxpayers after Gazprom. It has already paid 18 billion in dividends to its Russian partners, thus making an important part of the Russian budget, the U.S. official said.

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