For six years now, the world's largest country has been knocking on the World Trade Organization's (WTO) front door. For six years now, everybody inside has been shhh-ing each other, hiding behind the curtains with the lights turned off, pretending no one was home. But last week, Russia brought a gift and someone finally answered the door.
The European Union (EU) has agreed to drop its objections to Russia's admission to the WTO, in exchange for Russia's agreement to gradually increase the tariffs that Russian oil corporations charge Russian companies for natural gas.
Mind you, this is just the first step for Russia, which still needs to satisfy the objections of literally every other WTO member before it can join the club. And some of these negotiations will likely be difficult affairs. The U.S. is in the middle of a presidential election, and neither party's candidate is going to want to seem "soft on communism" (Russia calls it "managed democracy" now). Then there is China, with which Russia fought a series of border wars not too long ago. And Japan, from which Russia stole a couple of islands back in the 1940s. And 144 other countries...
In short, Russia is probably still at least a year away from WTO entry. Perhaps, several years. Fortunately, U.S. investors need not wait for Russia to enter the WTO (even after WTO entry, the benefits to U.S. companies might not be immediate) to begin benefiting from its concessions.
For example, right now, there are several U.S. oil majors that stand to benefit from Russia's concession on natural gas pricing. ExxonMobil
Meanwhile, U.S. companies currently operating in Russia will probably actually be hurt by Russia's concession to the EU. Companies such as Alcoa
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Fool contributor and Russian legal consultant Rich Smith owns no shares in any of the companies mentioned in this article.