For all the opinion offered on Russia these days, the key operating rule to keep in mind before reaching any conclusion is that the exact opposite of what’s being said is also true.

Many in the international media have conjured up an image of Russia as a hyper petro-power run by an authoritarian regime with a cold-war vision for the country. While there’s more than an element of truth in such a portrayal, it would also be fair to say that Russia has been working hard to reduce its dependence on oil, the Kremlin has rarely mattered less for the people on the street and capitalist fervour continues to sweep the economy.

Russia is increasingly turning out to be a tale of two different countries. At one level, the state is becoming more assertive and is seeking to broaden its influence in the “strategic” sectors of the economy as it looks to use oil as a weapon. This is undoubtedly undermining the investing environment and preventing the country from realising its full potential in the natural-resources sector. But the rest of the economy is caught up in one of the most powerful domestic-demand booms in the emerging-market universe.

The divergence in performance between the natural-resources sector and the rest of the economy is evident in the stock market. Shares of banking, media and consumer companies remain on a tear and have risen more than their emerging-market counterparts even this year. Meanwhile, stock prices of oil and gas companies have been drifting aimlessly over the past year, with a “Russia” discount assigned to them, as investors fear further government intervention.

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