updated 8/9/2004 11:19:52 AM ET 2004-08-09T15:19:52

Yukos shares soared on Russian exchanges Monday after last week’s ruling that its biggest production unit had been illegally seized by bailiffs. But concerns about the oil giant’s future persisted after a series of contradictory statements last week took the price of its stock on a rollercoaster ride that shows no signs of ending soon.

Trading in Yukos shares on Moscow’s ruble-dominated MICEX exchange was halted for an hour after the stock soared 24 percent in the morning, and shares were up 12 percent in the afternoon on the dollar-dominated RTS exchange.

The Yuganskneftegaz subsidiary was seized by bailiffs in July, and the Justice Ministry said it was being evaluated for possible sale, stoking speculation that President Vladimir Putin’s Kremlin wanted to dismember Yukos and turn it over to Kremlin-friendly executives.

Friday’s ruling by the Moscow Arbitration Court was a rare victory for Yukos and its owners amid a campaign of court cases and tax claims that is widely regarded as a punishment for the growing clout of the company’s former CEO Mikhail Khodorkovsky. The Kremlin has cast the complex web of court actions against Yukos and Khodorkovsky as a crackdown on tax evasion and shady business activities.

Preliminary hearings were held Monday on appeals by Yukos against the seizure of its two other main production companies, Tomskneft and Samaraneftegaz. The Moscow Arbitration Court decided it will hear the Samaraneftegaz appeal on Sept. 2, the Interfax news agency reported.

“Logically they should remove the arrest on the other units,” said Sergei Suverov, head of equity research at Zenit Bank. However, he added, “There is still an element of unpredictability.”

The bailiffs can appeal Monday’s ruling. Meanwhile, Yukos is still struggling with a 99.4 billion ruble ($3.4 billion) back-tax bill for 2000. Its stock was buffeted last week — and world crude prices were pushed to new highs — when an announcement by the company that it had been given access to its bank accounts was contradicted less than 24 hours later by bailiffs.

Yukos shipments warning
Late last month, Yukos CEO Stephen Theede warned that its oil shipments by rail could be partially halted in the second week of August unless it was given access to its frozen bank accounts. However, the head of marketing at the country’s rail monopoly Russian Railways, Marina Kovshova, said Monday there was no immediate danger of an interruption in Yukos shipments.

A Yukos spokesman said operations had yet to be affected by reduced liquidity as the bailiffs collect cash from the company’s accounts. Bailiffs announced last week that they had collected 22 billion rubles ( $760 million) of the 99.4 billion ruble bill. The company faces a similar back-tax claim for 2001 and tax authorities are probing its 2002 activities.

Yukos has received a number of offers to purchase its assets and help pay off its tax debt, which analysts say could grow to $10 billion.

The Sunday Times of London reported that a consortium funded by the ruling family in Dubai, the Al-Maktoums, has offered to buy out Khodorkovsky’s stake in Yukos and settle all its tax liabilities.

But the likelihood of the government passing control of the country’s biggest oil producer to an OPEC country is minimal, said Chris Weafer, chief strategist for Alfa Bank, said in a research note Monday.

“That could compromise Russia’s ability to continue to use oil as a strategic asset for broader political gain ... If it was simply about the money then a compromise could have been reached with Yukos management quite a while ago,” Weafer said.

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