Russia is experiencing a serious recession

The Russian economy slipped unexpectedly quickly into recession in 2015, with gross domestic product contracting 3.8 percent, up from 0.6 percent in 2014. The International Monetary Fund expects another decline in economic indicators this year, but, most likely, much less, by only 0.6 percent.

The oil price remains too low, therefore, the planned privatization of Rosneft looks almost hopeless in the current market conditions. Falling oil prices threaten Russia with a budget deficit equivalent to 36 billion euros. This assessment is given by the Minister of Finance Anton Siluanov, if the oil price remains at the current level. To compensate for the deficit, the sovereign wealth funds of the NWF could be used.

Rossi's 2016 budget is based on an oil price of $ 50 per barrel, but oil is now trading much lower. Energy sales account for about half of government revenues. The sharp drop in oil prices since mid-2014 is creating difficulties for the economy. Even the national currency, the ruble, has lost more than 50 percent against the dollar. Other oil producing countries are also under pressure. OPEC economies contracted 4.5 percent in the first nine months of 2015, while inflation rose to 141.5 percent, according to the Central Bank. This is the highest inflation rate in the entire world.

As Rosneft's revenues have dropped significantly due to the fall in oil prices, the Russian government wants to sell part of the oil company Rosneft. The Russian government has been discussing for several years about reducing the share. The finance minister said the fall in oil prices is creating new problems for the government. "The price of oil fell by a quarter from its previous value," Siluanov said. "We must build the state budget based on new realities."

In fact, observers currently cannot imagine how to determine the fair market value of Rosneft in the current environment. Therefore, it seems hopeless to take risks and sell shares under pressure.