Prospects for Russia's Oil Industry

Abstract

Russia has the world's largest natural gas reserves, the second largest coal reserves and the eighth largest oil reserves. Several factors are coming together to make it appear that Russia's energy industry has bright prospects for the foreseeable future. China's rapid rate of economic growth has greatly increased its energy needs, and therefore the demand for energy. This increase in demand has put upward pressure on worldwide oil prices. The same could be said for India, the world's second largest country in terms of population, which has also experienced rapid economic growth in recent years. Turmoil in the Middle East, which increases uncertainty in international energy markets, has also helped caused oil prices to reach record levels. Both of these factors - rapid economic growth by the world's two most populous countries and turmoil in the Middle East - appear to be long-term.

This paper discusses the prospects for Russia's oil industry.

Keywords: oil, Russia

JEL Classification: L71, P17, P23, Q4