The Impact Of International Oil Prices On The Russian Economy

The oil is the one of the most important natural resources in the modern economy and also it is becoming more and more relevant for developing countries,which already account for more than a half of world's total oil consumption.The goal of this study is to investigate the relationships between oil price and GDP,inflation,balance of payment,and trade balance through an empirical analysis using regression models.For our models we chose period from 1998 till 2016 year.All data for research was downloaded from IMF and Russian Federal State Statistics Service.For statistic analyzing,I used program EViewslOSV.For Russian Federation,as for one of most exporting oil countries,oil-is one of the most important sources of foreign earnings.The share of exports of oil and oil products in the total foreign exchange earnings of the country is about 15%.The role of the Russian oil complex as a source of budget revenues is constantly growing.This paper investigates the impact of oil prices on Russian economy,both theoretically and empirically.Theoretical analysis,which mainly discusses the relationships between Russian GDP and other macroeconomic indicators and international oil Prices.Relationships between macroeconomic indicators for oil exporters countries also were described in works of world's famous scientists,such as Hamilton,Fabio Gori and Li Xiaotong ect.Empirical results of our models show that oil price and Russian GDP,inflation,balance of payment,and foreign trade balance has deep relationships(the coefficient of R and R-Adjusted in our model is an about 99%).Granger causality test show that oil prices Granger causes Russia' s real GDP,Inflation,Export,Import,balance of capital balance of financial accounts.This can be concluded that Russian economy strongly depends on the high oil prices.Variance decomposition analysis results showed that Ural international oil prices contribute Russian GDP growth on 69%.The Inflation forecast variance 26%,balance of current and capital accounts fluctuations 55%,balance of financial account 56%are caused by fluctuations of Ural oil price.Variance of export and import due to international prices are very high and equal 88%and 81%.Is shows that international oil prices have deep relationships with Russian GDP,Inflation,balance of payment,and foreign trade balance.