Since the break up of the Soviet Union in 1991 there have been a great amount of turmoil, especially in Russia, in the transition to capitalism. There has been a decrease in the standard of living and the economy has failed thus far to create a greater material lifestyle for many people. Yet, in the mist of this economic turbulence there has been a beacon of light. This bright spot in the Russian economy is the oil and gas exports of the county.
Since the fall of communism in Russia new trade ways and pipelines have opened with other countries and have increased revenue greatly. Oil exportation has been increasing the past decade in almost all of Russia's export points (see attached chart), especially to pipelines in Europe. Natural Gas exports are up as well. This increase in business from countries such as Britain, Spain and France has helped this industry grow.
However, with this increase in income amidst a time when most businesses have fallen on hard times Capitalism has not been completely beneficial. Russian president Vladimir Putin has continually raised taxes for the oil and gas industry largely because they are one of the few enterprises succeeding in the hard economic times. Yet these taxes may help to fund the government and give it, in time, the ability to help other businesses and eventually boost the Russian economy.
Despite increases in gas and oil purchases from other countries, sales from former soviet states have been decreasing as they have started importing from elsewhere. Much of this is due to the fact that these states (Estonia, Latvia, Etc.) are trying to disassociate themselves from Russia and the control Russia had over them in communist rule. However, they still depend a great deal on Russia for fuel because it is close and is such a large producer. Also, the Russian oil companies had to suffer some losses from delinquent payment due to former soviet countries having economic troubles much the same as their own.
