Russian oil production expected to drop

Oil production woes to damage economy.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |   July 7, 2014 at 10:14 AM
| License Photo

MOSCOW, July 7 (UPI) -- An anticipated drop in oil production by 2016 is expected to hurt the Russian economy, the Russian Finance Ministry said Monday.

The ministry said Monday it expects a $4.5 billion decline in oil export revenue because of an anticipated 6.3 percent drop in oil production from 2014 figures.

The ministry said the federal budget next year will receive about $2.2 billion less than expected because of a contraction in exports.

A report on the Russian economy from the World Bank in March said real gross domestic product growth in 2013 was 1.3 percent, compared with 3.4 percent in 2012. There's a "confidence crisis" emerging within the Russian economy, the bank warned.

"In the past, the lack of comprehensive structural reforms was masked by a growth model based on large investment projects, continued increases in public wages, and transfers -- all fueled by sizable oil revenues," it said.

Russian energy exports last year accounted for more than 10 percent of GDP.

Related UPI Stories
Latest Headlines
Trending Stories
Pepsi to release 'Back to the Future Part II' inspired Pepsi Perfect
Nobel Prize in medicine awarded to parasitic disease scientists
Womb transplants begin in U.K. after Sweden's success
Gay Vatican priest comes out day before Pope Francis begins synod on family issues
Scientists find roadmap that may lead to 'exercise pill'