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New statistics say Russia's economy has grown more dependent on oil and gas

Source: RBC

Russia’s Federal State Statistics Service (Rosstat) has recalculated the country’s industrial production index, updating its base year from 2010 to 2018, and found that the economy’s share of oil and gas production rose from 34.3 percent to 38.9 percent in the overall structure of value added, according to the website RBC.

The industrial production index is an economic indicator that measures real production output of manufacturing, mining, and utilities. These indexes are computed mainly as fisher indexes (measuring relative prices between time periods and locations) with weights based on annual estimates of value added. Rosstat calculates separate baskets of goods for each type of economic activity. As explained by RBC, it’s misleading to compare data on different kinds of production in different regions, so Rosstat bases its comparisons on data from a base year, in order to capture structural changes in the economy. The base year of macroeconomic indicators is periodically revised to improve the quality and representativeness of the indexes.

The share of other activities in the Russian economy, especially the manufacturing industry, dropped from 53.2 percent to 50.7 percent. 

Rosstat also published preliminary data estimating that Russia’s industrial production in 2020 will rise 1.1 percent in comparison with last year. In the first month of 2020, Russian manufacturing grew 3.8 percent, oil production fell by 0.8 percent, and coal production grew 8.8 percent. Natural gas and gas condensate production grew 4.3 percent, while LNG output jumped 36.3 percent. 

In 2018, Russia’s Finance Ministry declared that the ruble’s dollar-exchange rate no longer depended on the price of oil. At various times in recent years, officials in Russia’s Central Bank have also claimed that the country’s dependence on oil has fallen three-fold, seven-fold, and even ten-fold.