Russia 'rainy day' fund to reach $36 billion by year-end

Russia's 'rainy day' fund collected from taxes on windfall oil profits is set to reach one trillion rubles ($36.3 billion, EUR27.5 billion) by the end of the year, a senior Cabinet member said Tuesday.

Deputy Prime Minister Alexander Zhukov said the fund had already accumulated 700 million rubles ($25.4 million, EUR19.3 billion), the Interfax news agency reported.

The stabilization fund, which the government has been using to pay down Russia's foreign debts early, was created to insulate the nation against oil price fluctuations.

Russia, the world's second largest oil exporter after Saudi Arabia, has seen its state coffers boosted by record world crude prices, which have been above $50 a barrel for weeks.

Zhukov said that the fund would hit a trillion rubles even if oil prices fell below $36 a barrel in 2005.

Associated Press