To decipher Russia’s riddle, watch its oil

The Russian economy is highly dependent on oil. It provides roughly 20 percent of GDP – maybe as much as 40 percent, if its impact on the rest of the economy through orders for machines, pipe, steel and other goods and services is included, estimates Marshall Goldman, longtime Russia analyst and author of “The Piratization of Russia: Russian Reform Goes Awry.”

Oil and gas revenues have enabled Russia to boost the pensions of its senior citizens, prepay some $17 billion of Soviet debts to foreign nations and institutions, and build up a government “stabilization fund.”