Prospects seen in problems of C.I.S. downstream sector

For good reasons the attention of Russian authorities and western investors has until now focused on problems of the upstream oil sector in the Commonwealth of Independent States and the Sharp fall in output since the late 1980s. This article attempts to give a more balanced view of the industry by drawing attention to the problems and opportunities in the refining and distribution sector, where western companies are now beginning to invest, and comparing the investment opportunities with those in the upstream. It concludes that given recent experience of the high cost and practical difficulties of increasing crude output, it would make more commercial and economic sense to direct a higher proportion of the industry's investment into improving the effectiveness of the downstream sector