By Vestnik Kavkaza
Today prices for Brent and WTI oil continue falling in the context of expectations that the volume of oil supplies on the world market is quite sufficient to satisfy reducing demand, according to Bloomberg.
The head of the Russian Financial Ministry, Anton Siluanov, thinks that the weakening of the ruble is connected with the oil price fall and geopolitics. “We are monitoring the situation. It should come settle. The currency value is trying to find a balance, considering the new situation in the trade balance and outflow of capital,” Siluanov thinks.
However, according to Yuri Stankevich, the deputy chairman of the Committee for Energy Policy and Energy Efficiency of the Russian Union of Entrepreneurs and Businessmen, “speaking about the short-term prospects, of course oil prices falling, even down to $80 per barrel, is a bad thing. It is bad because we know what the main source of the budget’s revenues is.”
Stankevich says that “oil prices are falling, while dollars have to be exchanged for rubles. The lower oil prices are, the weaker the ruble should be to fulfil the current liabilities.”
Speaking about the influence of the tendency on the Russian economy, Stankevich noted: “6 years ago, 16 years ago and almost 30 years ago oil prices fell. Unfortunately, history’s lessons didn’t teach us anything. In the long-term prospects such changes and serious fluctuations are positive, as we have to learn to live under any conditions. Today we discuss the fact that America is taking certain steps, whether Saudi Arabia will deal with America or not. But will the fall continue for a long time? Considering the accumulated reserves, will we pass through the period painlessly? Such topics were acute in 2008-2009, when we discussed whether money of the Reserve Fund would have been enough to fulfil liabilities, to support the banking sphere, to support industry, and so on. We always blame some external factors. I think it is high time. These events have been repeated in modern history many times. We should be ready for any scenario, we should search for internal reserves, which would enable us to minimize the dependence of the economy on external factors and minimize the negative consequences which we are facing today.”
