Research and Markets: Political and Policy Analysis of the Russian Energy Industry

Research and Markets ( http://www.researchandmarkets.com/research/367582/political_and_poli) has announced the addition of Frost & Sullivan's new report " Political and Policy Analysis of the Russian Energy Industry" to their offering.

This Frost & Sullivans Energy Country Industry Forecast service provides vital inputs for evaluating the attractiveness of a country and its energy industry. Besides enabling decision makers to assess the impact of non-market forces, it also helps in identifying new market opportunities. This service provides a strong base for preparing contingency plans. In addition, investors can assess industry-specific risk factors as well as conduct a more in-depth micro research.

Globally, both demand- and supply-side investments play vital roles in driving the energy industry. In a tough financing environment, cutbacks in capital expenditure and project delays have affected global upstream and downstream markets across the world. Therefore, governments have been carefully monitoring the domestic energy requirement levels and energy security-related aspects in a bid to sustain investment levels and ultimately, improve economic growth. Ultimately, the political and policy establishment plays a critical role in prioritizing this industry in the development agenda of a country. General political policies greatly affect this industry and industry-specific policies, wherever effectively enforced, provide added impetus. The economy of the country plays a huge role in strengthening and boosting the industry with its effective trade ties and inflows of foreign direct investment (FDI). These, in turn, determine the performance of the energy industry.

Russia is battling the combined impact of the global economic and financial downturn. Nevertheless, investors may enter the Russian market for its high return on investment, even as world oil prices rise post 2010. The Russian Government is expected to strategize to protect its economy from the volatile economic fluctuations caused by energy prices and supply. Russia will look to maintain overall international relations with its energy trading partners in a bid to continue funding its domestic social programs with the revenues earned from energy exports to rest of the world. With the countrys economic growth and budgetary outlay heavily tied to the price of energy exports, its political leadership has laid stress on policies supporting domestic oil and natural gas production.

The oil and gas industry generates almost half of Russia's federal budget. An enormous revenue deficit due to fluctuating energy prices, therefore, dampens Russia's economic growth and weakens investor sentiments. However, in the long term, investors in the energy sector can expect the Russian government to overhaul the tax system due to the financial downturn, thereby creating opportunities in areas of production, geological-related exploration services, modernization of oil recovery and refining systems, drilling and production platforms, vessels and marine equipment, as well as ship building activities. Additionally, Russia is expected to encourage the export of liquefied natural gas (LNG), even as the energy sector is reeling under the pressures of possible cancellations and lowered capital expenditure. In the future, the Russian LNG production is expected to trigger demand for pipelines, enabling distribution among its end users. The expansion of LNG is likely to create opportunities for investors in transportation and storage facilities (particularly terminals), LNG shipping technologies, development of floating storage, and re-gasification units for deployment in remote regions of Russia.

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