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The Dupuy Institute

Excellence in Historical Research and Analysis

Russia Plans for $40 Oil

Christopher A. Lawrence
October 15, 2016

Part of the drama of the Russia budget shortfalls is that they kept making budgets based upon an unrealistically optimistic predictions of oil prices. This forces them to revise their budgets rather drastically during the year. It appears they have finally accepted that oil prices are going to be around $40 a barrel for a while and have planned their budget accordingly: Russia budget oil price

A few points:

This is for the next three years and even though oil is currently at $50 a barrel.
There current budget deficit is 3.7% of GDP and is expected to remain above 3% for next year. To put this in perspective the U.S. has had a budget deficit greater than 3% a year from 2008 through 2013.
Cash reserves were $91.7 billion in September 2014…now expected to be $15 billion at the end of this year.
Energy now only accounts for 37% of all government revenues, vice the 50% it used to be. I gather that this is because energy revenues have precipitously declined, not because they have developed other significant sources of revenue.

As the article notes at the end: “Eurasia Group analysts say the government is still opting for more austerity rather than genuine economic reform.”

Christopher A. Lawrence

Christopher A. Lawrence is a professional historian and military analyst. He is the Executive Director and President of The Dupuy Institute, an organization dedicated to scholarly research and objective analysis of historical data related to armed conflict and the resolution of armed conflict. The Dupuy Institute provides independent, historically-based analyses of lessons learned from modern military experience.

Mr. Lawrence was the program manager for the Ardennes Campaign Simulation Data Base, the Kursk Data Base, the Modern Insurgency Spread Sheets and for a number of other smaller combat data bases. He has participated in casualty estimation studies (including estimates for Bosnia and Iraq) and studies of air campaign modeling, enemy prisoner of war capture rates, medium weight armor, urban warfare, situational awareness, counterinsurgency and other subjects for the U.S. Army, the Defense Department, the Joint Staff and the U.S. Air Force. He has also directed a number of studies related to the military impact of banning antipersonnel mines for the Joint Staff, Los Alamos National Laboratories and the Vietnam Veterans of American Foundation.

His published works include papers and monographs for the Congressional Office of Technology Assessment and the Vietnam Veterans of American Foundation, in addition to over 40 articles written for limited-distribution newsletters and over 60 analytical reports prepared for the Defense Department. He is the author of Kursk: The Battle of Prokhorovka (Aberdeen Books, Sheridan, CO., 2015), America’s Modern Wars: Understanding Iraq, Afghanistan and Vietnam (Casemate Publishers, Philadelphia & Oxford, 2015), War by Numbers: Understanding Conventional Combat (Potomac Books, Lincoln, NE., 2017) and The Battle of Prokhorovka (Stackpole Books, Guilford, CT., 2019)

Mr. Lawrence lives in northern Virginia, near Washington, D.C., with his wife and son.

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