If Oil stays below $60, what will Putin do? He needs to keep the momentum of Russian patriotism going which has all be funded by higher energy prices. The Russian people would have idolised who ever was President during the recent energy price boom. It just happened to be Putin. Increased miltary spending is planned, my guess is Russia will need an excuse for increased tensions on its western borders and the proposed missile shield will probably be it. If Obama surprises and aborts missile shield plans, Putin will have to orchestrate another area for tension. Everything happens for a reason and maybe this economic crisis at the moment is a blessing in disguise for democracy. Russia needs to be brought to its knees, but then again if it does go to its knees it will do something drastic. AM i wrong in saying that this crisis is hurting countries like Russia more than USA and EU? My understanding of the crisis and its effects is not too good, but my guess is the US will whether it better than most countries, Russia included. AT the end of the day its all a relative game, he who loses least wins. I am living in Eastern Europe and the subject of the politics of Russia is close to my heart. I dont trust Russia as a country. In my mind parallels can be drawn between Putin and Hitler of the early 30's, the whole nation rallied around him giving him more and more power, until he could have all the power he wanted. It will take Russians 15 years from now to realise that the direction their "god" who they idolise has chosen for them was wrong. I see Medvedev hinting at extending the presidential term from 1 year to 6 years. My guess is their government passes that and then Medvedev goes into early retiremnent and Putin, "sigh, relunctantly ha to take over as President again- as a favour to the Russian people he loves so much" My guess is something big is brewing and strife will carry their current patriotism further and for longer if the economic horizon looks bleak. So i am sure there will be some justified invasions or strikes into countries like the Ukraine and maybe even Poland, maybe a lot sooner than you think.
If oil prices stay below$60 Russia will be in bad shape.Here's a good article from last week with some explanations of what the effects would be and why: http://www.iht.com/articles/2008/10/31/business/31ruble.php?page=1
"Overextend and die" - the golden rule for empires. Those idiots are thinking about building 5 aircraft carriers! It is a pipe dream. US has way to many of those it is a colossal drain on the treasury but for Russia's petro economy life is going to be bad. Soviet Union fell into precisely this trap when it got into afghanistan. Oil prices surged during the 70s and then collapsed to saner levels in the 80s. Problem was, expenses were created with the expectation of much higher oil prices.
Mother Russia will run a high risk of defaulting on external debts. They tried our American trick with Ossetia, and thought that a small conflict in an oil producing region would send oil through the roof. It didn't work, this was during the beginning of the great unwind of oil contracts. Fuck Russia, they're the most undiversified country I have ever seen in my life. Their success as a nation can be correlated 100% to the CRB index, what a joke.
OP by even considering that OIL will stay below 60 this shows that are completely hopeless and perhaps retarded pick a better life next time you are a spirit
I believe Russia state budget was calculated for the price of oil USD 70 per bbl. Their high sulphur crude oil is getting about USD 52-54 per bbl on spot market. Long term contracts prices are about 10-15 percent lower. Let say it straight not too much sales on spot. BTW Iran budget is made on prices USD 55-60 per bbl.
First, the price of Natual Gas is of greater matter to Russia. The fact, that NG prices fell all the way to their "pre-bubble" 6-9 levels (correlating to crude < 40) leaves room for speculation that the NG is actually manipulated for political reasons. Second, it has an effect on Russia's budget, but I'd say you overextend it. Russian economy has developed greatly over the years. Anyone comparing Putin <-> Hitler only shows how much you are already brain-washed by "freely speaking" western media. LOL, this is stupid and absurd. Putin is not a democrat and god may help you if you are his enemy. But actually he indirectly admits it. Bush has actively started 2 wars of global scale and western media praise it as the fight for freedom. Putin dares to defend his interests and people in Ossetia, moving out after 3 weeks or so, after actually being pressured to do so and european politicians start to yell. A few of you guys are seriously misguided.