Russia's Management of Oil and Gas

In order for Russia to create a more diversified and stable economy, the government must change how it manages the enormous profits it earns from oil and gas—money that accounts for a quarter of Russia's GDP, half of the federal budget revenues and three-quarters of all exports. Russia is the world's largest oil and gas producer, but as it has grown more dependent on petroleum income, its economic success has become a Potemkin façade, disguising a lost opportunity for urgently needed economic modernization. In this RWI brief, Antoine Heuty argues that, without economic diversification and greater transparency in oil and gas management, Russia will suffer another lost decade.