While US WTI crude briefly stumbled below $30 for the first time in 12 years, Russia's Urals blend is already below that mark trading at $27.14 a barrel. Given the new reality, the Kremlin has ordered stress tests with $25, $35 and $45 oil. Russia’s federal budget for 2016 relies on an average annual oil price of $50, which almost corresponds to the last year average price - $51.4 per barrel. According to business daily Vedomosti, Russia’s First Deputy Prime Minister Igor Shuvalov has instructed the ministries to work on different scenarios, both bearish and bullish.
The most recent collapse in energy prices from November means the Russian budget will lose 300 billion rubles (about $4 billion) in oil revenue in the first two months of 2016, according to the newspaper’s ministerial source.
The updated macroeconomic forecast will be presented by Economic Development Minister Aleksey Ulyukaev later this month. In the meantime, the government has decided to cut spending by 10 percent.
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INC News, 13/01/2016 - via ©RT News
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