Russia is the world’s largest and one of the most populous country, with a population of more than 145 million people. Aside from its statistical prowess, Russia has been a formidable economic force, serving as the world’s greatest provider of key commodities such as oil and coal. During the Soviet regime, Russia harnessed natural resources to acquire power and economic advancements, which helped to grow major industries like energy, mining, and engineering. In addition, Russia’s oil, gas, and electrical industries grew at a tremendous pace.
After the Soviet Union started to disintegrate, Russia got integrated with the global system markedly. Despite economic turmoil and hyperinflation first slowed the entry of capital inflows into Russia, it experienced rapid expansion in the early 1990s and came to a halt in 1998 under the effect of the crisis. Apart from a strong centralized state, Putin desired economic stability for the fatigued Russian people who had lived through the Soviet Union and the 1990s. As a result, in the new time in which he took power, he would acquire the people’s approval and enhance his position. In terms of the consequent budget deficit, foreign debt could not be found in sufficient quantities, and the situation was attempted to be rectified in part by printing money, which resulted in significant inflation. As a result, Putin has reduced spending and begun to collect more taxes since 2000 in attempt to find a solution to the budget problem.
Russia expanded both internal and outward flow of capital after restructuring its foreign loans in the early 2000s, and economic growth and liquidity expanded dramatically as oil prices rose. They also implemented policies which transformed their economy into the capitalist principles where they did it with the help of privatization. Financial stability improved because of external factors, and between 1996 and 2005, it grew at a rate of 3.8 percent per year on average. Currently, Russia is the world’s largest exporter of wheat, and they also export crude oil, refined petroleum oils, and coal to many countries. Since 2017, Russia’s exports have increased rapidly, and they export the goods mostly to China, Netherlands, Germany, Turkey, etc.
Coal
To begin with, coal has long been one of their most important exports. Russia is now the world’s third largest coal exporter, after Indonesia and Australia, accounting for around 18 percent of worldwide coal supply, and almost three-quarters of coal takes place in Siberia. Russia exported 211 million metric tons of coal in 2021, up 12.8 million metric tons from the previous year. Furthermore, Russia supplies coal mostly to the OECD (31%), China (43%), Japan (22%), and South Korea (20%). However, following the conflict between Russia and Ukraine, Russia’s coal exports to the OECD fell by 12%, from 6.45 million metric tons to 5.67 million metric tons. The largest resources of coal are found in Tunguska and Lena basins of East Siberia and the Far East, and, almost, 75% of Russia’s coal is produced in Siberia.
Wheat
During 1970 and 1990, the Soviet System was buying grains, wheat, or cereals to feed and provide food for their livestock industry. However, in 1990, Russia could not refinance their industries, so the country’s livestock fell by half. Since that time, Russia’s main goal has been to revive the livestock and to be as self-sufficient as possible in agriculture. To accomplish this goal, Russia has been developing its grain infrastructure to accelerate trade by investing huge amounts in ports. In 2000s, Russia was producing 30 million tons of wheat per year, however, now, this number is more than 80 million which is 150% increase in just 20 years. Wheat is one of the most essential exports of Russia, with the country being the largest exporter of it, currently. Russia exported 38.5 million mt wheat in 2020, making it the country’s seventh largest export, accounting for 19% of global grain production. Furthermore, in 2021, the country exported around 44 million mt of wheat, accounting for nearly 24 percent of total global wheat output. However, the conflict between Ukraine had a negative impact on their wheat output, and they temporarily ceased exporting wheat to several nations, particularly OECD countries.
Oil and Petroleum
Russia is one of the most significant countries for oil, gas, and petroleum because of its vast energy resources, ranked in third place globally. In 2021, Russia generated more over $211.5 billion in mineral fuels, accounting for about 43% of total exports. Furthermore, the country produces more than a quarter of all the oil in the globe. Most Russia’s oil resources originate from the northern section of West Siberia, but the Volga-Ural zone and the Komi-Ukhta field are also key sources of oil. China ($23.8 billion), the Netherlands ($9.26 billion), Germany ($6.38 billion), South Korea ($5.03 billion), and Poland ($4.22 billion) are the top buyers of Russian crude oil. It sends over half of the 5 million barrels of oil it produces and exports every day to Europe. Russia’s oil imports satisfy 8% of Britain’s oil requirements. Although the United States is less reliant on Russia than other countries, Russia supplies 3 percent of imported oil. Because of the war, European countries started to discuss possibility of finding alternatives for Russian petroleum.
Iron and Steel
In 2021, iron and steel contributed for over 6% of Russia’s total exports at $28.9 billion. The majority of Russian iron is produced in the Kursk magnetic anomaly, the Kola Peninsula, the Urals, and Siberia. Currently, the country generates 17% of total global iron and steel output and 20% of other valuable commodities such as jewels. The nation is also a major producer of cobalt, copper, gold, nickel, and platinum. Russia now sells Iron Ore mostly to China ($885 million), Ukraine ($202 million), Germany ($155 million), Slovakia ($129 million), and Turkey ($101 million).
