The oil and gas fund will accumulate severance taxes and export duties on oil, oil derivatives and gas, unlike the Stabilization Fund that only accrues severance taxes and export duties on oil.
The Reserve Fund will be used when oil and gas revenues are below the fixed oil and gas transfer.
The non-oil and gas budget deficit, which will not take into account oil and gas revenues, should not exceed 4.7% of GDP in a forecast period, with the Finance Ministry taking up management of the new funds' assets.
The Central Bank could assume certain powers for the management of the Reserve Fund, and together with special financial establishments it could handle the Future Generations Fund under contracts with the Finance Ministry.
The Reserve Fund could be made up of foreign currency and currency denominated financial assets.
Before February of the current fiscal year the two new funds will place the federal budget's surplus balances as of early this year, which should correspond to budget revenues as of December 2006.
In his budget address in early March, President Vladimir Putin called for transforming the Stabilization Fund, set up in 2004 to accumulate windfall oil revenues, into the Reserve Fund and the Future Generations Fund.
As of January 1, 2007, the fund equaled 2.347 trillion rubles ($90.2 billion),
According to the Finance Ministry's investment formula, U.S. dollars account for 45% of the Stabilization Fund's foreign currency, euros make up 45%, and 10% is in British pounds.
The Stabilization Fund is expected to reach 3.691 trillion rubles ($141.9 billion) as of January 1, 2008.
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Iran has been a central Russian ally in the Middle East, despite considerable tensions between the two. But by renewing dialogue with the West, the new Iranian leadership has chosen another direction. The shifting terrain in the region creates new strategic, political and economic challenges for Russia.