Bloomberg News

Prokhorov Says Russian Economy Won’t Recover With $80 Oil

June 08, 2009

Billionaire Mikhail Prokhorov, named Russia’s richest man by Forbes magazine, said Russia’s economy won’t return to sustained growth even if crude oil prices rebound to as much as $80 a barrel.

Russia’s government should focus on boosting demand, weakening the ruble and making the economy more competitive and cost-effective, Prokhorov said on his blog today.

“Monetary policies have practically reached all their priorities,” he wrote. “Considering the specifics of Russia’s economy, it will be more effective to accomplish goals that are closer to Keynesianism.”

Crude oil in New York has jumped 29 percent in the past two months. Urals crude, Russia’s chief export blend, has averaged $48.87 this year. The country’s revised 2009 budget is based on an average price of $41 a barrel.

To contact the reporter on this story: Paul Abelsky in St. Petersburg at pabelsky@bloomberg.net.

To contact the editor responsible for this story: Chris Kirkham at ckirkham@bloomberg.net


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