Gold prices 'sparking interest in Russia'

The recent boom in gold prices has prompted a number of Russia's most prominent businessmen to move into the sector, it has been claimed.

A "frenzy" has been sparked by the yellow metal reaching record highs at several points over the last few weeks, Peter Hambro of Peter Hambro Mining told Reuters.

Other experts appear to agree. One analyst, Mikhail Stiskin of Troika Dialog, said that Russian businessmen are now looking at investing in gold "because they are bullish on the commodity itself and bullish on Russia's potential as a place with an extensive but under-explored mineral base".

The last five years have seen gold output in Russia decline, with Valery Braiko of the Russian Gold Industrialists Union recently telling Reuters that 2007 production is expected to be up to three tons less than that seen in the previous year.

Falling production is one of the drivers of rising gold prices and with fewer new deposits being found globally, it is possible that this could continue to further influence the value of gold bullion.

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