The Russian government's long-term energy strategy
to 2020 was sent to the Cabinet for discussion last month and
should be approved before the summer holidays. The
development of the energy sector remains a priority for the
Kremlin, accounting for half the economy and just over
three-quarters of stock market capitalization.
"Russia will always be primarily a raw materials exporter. It is
where Russia's competitive advantage lies and despite the efforts
to diversify the economy the Kremlin will never lose sight of the
importance of these resources to Russia's future development," says
Rory MacFarquar, an economist with Goldman Sachs.
President Vladimir Putin's administration has developed a habit
of consistently under-estimating Russia's progress. The draft is
short on detail and modest in its predictions but lays out a plan
for steady improvement and a more efficient, market-oriented
Russia.
The strategy offers a pessimistic and an optimistic long-term
projection for oil and gas output...
