Moscow - Like a teenager at the wheel of his diamond encrusted Mercedes, Moscow feels invulnerable, set to swerve past the US housing slump and slam through the global credit crunch.

And today's precious fuel prices have armed Russia's economic heavy foot.

"Nothing bad, nothing awful will happen," Vladimir Bragin, an analyst at Trust Bank, said blithely. "If Russian oil prices remain relatively high, there'll be no problem."

Russia's economy in blush is underpinned by plentiful commodities, strong growth spurred by a consumption and investment boom and a banking system that is largely insulated from the paucity of money that has threatened lenders in other markets.

"This is an unusual global slowdown in the sense that it hasn't hit Russia's main export commodities," agreed Rory MacFarquhar, a managing director at Goldman Sachs, which "very bullish" on commodities predicted last week that oil prices could spike as high as 175 dollars per barrel in the long-term.

But neither is Russia's economy susceptible to collapsing as in 1998 from a sudden drop in oil prices, economists in the capital said.

"For Russia this is all gravy. This money is all going straight into government accounts," said MacFarquhar.

Now approaching the 10th anniversary of the financial crisis, the singe of cautiousness marking Russia's financial authorities after watching their nation's savings vaporize in 1998 has left Russia best positioned to weather through.

The government has culled huge current account and budget surpluses from taxes on oil into the so-called state Stabilization Fund, representing 170 billion dollars taken out of the investment cycle to mitigate the relationship of world oil prices on Russia's growth.

"With most of this oil windfall is taxed away and stashed away now, the effect of oil prices is not as strong as seven years ago," said Yaroslav Lissovolik, Deutsche Bank's chief economist in Russia.

Addressing the World Economic Forum in Davos, Finance Minister Alexei Kudrin ebulliently proclaimed Russia "an island of stability," perhaps teasing other economic leaders caught out in the storm.

Nonetheless, both Russian indexes plunged in last month's global stock market tumble and Moscow felt the same thirst as other markets as cheap money from corporate borrowing and oil inflows dried up.

"It is not as if Russia is an island. It is part of the world economy. The financial channel is hurting much more than one could expect," stressed MacFarquhar of Goldman Sachs, which revised its growth projections a full percentage point to down from last year's 8.1 per cent.

Russian banks and companies accumulated a lot of external debt and some significant institutions are likely to be caught out unable to refinance let alone borrow more, judged Anders Aslund, a senior fellow at Peterson Institute for Economics.

In the first two months of this year net private capital outflows reached 18 billion dollars, according to the Central Bank.

These outflows place greater pressure on interest rates to rise among other factors that may lead to liquidity downturn persisting into April, said Lissovolik.

But confidence in Russia is based in part on the ability of financial authorities to mitigate a crisis and thus far Russia has clearly opted for protecting its banking system rather than moving to deal with ballooning inflation.

The country's heavy financial war chest may be used to offset the worst of a crisis, said MacFarquhar.

"Simply by deploying that money in the domestic economy they can substitute for credit inflows that haven't materialized," he said.

Growth predictions averaged a bullish 7.5 per cent among Moscow banks contacted by Deutsche Presse-Agentur dpa, who cited strong consumer and investment data.

"Really the story with respect to Russia is the consumer and investment boom working in tandem to produce these high growth rates," said Lissovolik.

These aggregates are less vulnerable to the current credit crunch "showing Russia is very much resilient to global shocks," he said.

The consumer credit boom last year was the result, not the cause of consumer credit and retail loans linked to the baking sector, said Bragin of Trust Bank.

Whereas, Aslund speculates that Russia's problem may even be an excess of capital inflows as investors see the glow of Russia's economy alongside gloomier markets.

In dramatic reversal of the fortunes of 10 years ago, Russia may turn a profit from the current crisis, leading the tide among emerging markets.

Economic ambassador Kudrin's vociferous affirmations at every public appearance - "Russia stands slightly apart," "We have done it" and "Russia's economy remains highly resistant" - underscores the economy's positive fundamentals and is perhaps the best favour to be doing for the Russian economy.(dpa)