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Today in Russian Business – May 26, 2009

Finance Minister Alexei Kudrin is basing next year’s budget on the prediction that oil will be at least $50 a barrel – an improvement on this year’s prediction of $41.  Medvedev is not so optimistic, presenting his budget priorities himself and showing a pessimistic outlook, urging for budgetary cost-cutting: ‘in 2009, unfortunately, we expect a deeper contraction than our initial forecasts, with a budget deficit of 7%.  Mikhail Khodorkovsky has said that business chiefs are not taking the right measures to help Russia emerge from the crisis.  Restructuring debt or default is the prospect faced by highly leveraged companies who need to pay roughly $130 billion in debt repayments this year.  British retailer Sainsbury’s is apparently contemplating opening stores in Russia.  Food prices in Russia have sky rocketed this year, increasing by 5.8%, ten times the rate of increase in the rest of Europe.  Russia’s $1 billion-a-year trade with Egypt could be compromised by the recent problems with Russian wheat.  Oleg Deripaska is reportedly close to signing a debt restructuring deal that will see him regain control of his debt-stricken business empire.