Forbes: Russian economy can survive $30 per barrel

The Russian economy has adjusted relatively well to lower oil prices, Forbes columnist Kenneth Raposa writes.

"We’re basing our Russia scenarios on some sanctions relief this year, but I wouldn’t count on it being an economic miracle worker. It’s still a very big consumer market, one of the biggest in Europe. There are a lot of good companies in Russia that have become more self-reliant because of the sanctions," he cited the words of a fund manager of Alger Emerging Markets Strategy, Deborah Medenica, as saying.

He also refers to Sberbank CIB analysts, who see “no threats to fiscal stability” this year, as the government has some room to maneuver. Russia still has nearly $50 billion in its emergency Reserve Fund and over $70 billion in its National Wealth Fund, Kenneth Raposa recalls.

According to him, "if oil heads to $40, the ruble will strengthen, taking pressure off inflation and giving the Central Bank reason to cut interest rates. Higher oil prices would help ease a number of Russia’s fiscal problems, though those problems remain manageable for the time being".

"The good news is that growing segments of the economy do exist. Russia’s government is run by true fiscal conservatives that have turned off any fears of defaults, despite sanctions, unfavorable oil prices and a pesky recession," RIA Novosti cited Raposa as saying.