Will we see dollar for 100 rubles?

Against the background of the continuing drop in oil prices, a barrel of which costs less than $ 38, a likelihood of a new collapse of the Russian national currency up to 100 rubles per dollar, which is more than even in the worst days of December 2014, is being discussed for the moment.

However, the Ministry of Finance remains calm and urges not to yield to panic. The Deputy Head of the agency, Maxim Oreshkin, assured that to date there is no reason for the US currency to reached three-digit figures. "The overall economy has adapted in terms of the balance of payments to $ 40 per barrel, therefore there are no reasons to expect 100 rubles for a dollar,’’ he said.

According to the deputy minister, the only thing that can threaten the Russian economy today is the budget deficit.

An advisor on macroeconomics, the Director General of the brokerage house ‘Opening’, Sergei Hestanov, in an interview to Vestnik Kavkaza expressed the view that there no preconditions for the dollar to achieve mark of 100 rubles.

"There is a very simple empirical formula. There's a little change in numbers, but they do not change much and not very fast. Until recently, this formula looked like this, 3200 rubles  is the cost of a barrel of oil, which is needed to balance the Russian budget. We need to share this number on the value of the brand of the Brent oil, and this forecast of the ruble. The formula is not  one hundred percent accurate, but the ruble has been confirmed by this formula for pretty long time. There are possible deviations from the formula, but they usually do not last long. If the government reduces spending, the amount decreases, if the state, accordingly,  spends reserves intensively,  the amount is also decreases. And it turns out that under this formula  for the dollar exchange rate to be exceeded 100 rubles to the dollar, it is necessary that for oil to be around $ 30 per barrel. As for now, thankfully, considerably, oil is more expensive, accordingly, the dollar against the ruble is much less than 100 rubles to the dollar ",  he said.

However, due to the return of Iran to the oil markets in the first quarter of the next year, the situation may change. "If the country pursues an aggressive policy and provide discounts widely on their oil, to  eliminate completely the fall in the prices to $ 30 per barrel is impossible. Therefore, unlikely, but due to the unfavorable  circumstances, in principle, the dollar could reach 100 rubles per dollar . But this requires that the prices on the world market to be very much fallen. Due the low prices some fields become unprofitable, production at them begins to clot, it leads to the fact that the oil production is declining, and prices begin to grow again. Therefore, the ruble rate of 100 rubles to the dollar is possible, but rather unlikely in the near future circumstances ", the expert believes.

"Unfortunately, we do not know what prices Iran will provide. Objectively, if they are not large, the volume of its deliveries would not be enough to bring down the price to $ 30 a barrel. But on the other hand, Iran has been under severe sanctions in 2012, it is hungry for the hard currency. So, unfortunately, after the Iranian leadership not only in words but in deeds will demonstrate how the country will put its oil to the world market, any predictions, unfortunately, are quite approximate,’’  Hestanov complained.

He added that to date there is no  ‘’full understanding of how Iran will win back its market." "It is possible that if its proposed prices are very high, it can lead to the fact that part of the Russian oil purchasers will switch on Iran, and, accordingly, it is also a serious threat to the exchange rate,’’  the expert suggested.

Speaking about devaluation that occurred, the economist pointed out that, in a sense, it has benefited the country's financial system. "Because I am occupied with  macroeconomics, the following is important for me. At the beginning of the year we had a budget deficit of 7.9%. This is quite a lot. In recent days, the budget deficit fell to a value of about 3% of the GDP, which corresponds exactly to the handling of the budget. And what does handling mean, in simple terms? It is an opportunity for the  budget to fulfill its obligations - to pay pensions, salaries to state employees. From this point of view, indeed, the devaluation of the ruble has benefited the budget ",   Sergey Hestanov concluded.