{"id":48393,"date":"2019-09-11T07:56:19","date_gmt":"2019-09-11T12:56:19","guid":{"rendered":"https:\/\/olduvai.ca\/?p=48393"},"modified":"2019-09-11T07:56:23","modified_gmt":"2019-09-11T12:56:23","slug":"russia-considers-possibility-of-25-oil-next-year","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=48393","title":{"rendered":"Russia Considers Possibility Of $25 Oil Next Year"},"content":{"rendered":"\n

Russia Considers Possibility Of $25 Oil Next Year<\/a><\/h3>\n\n\n\n
\"MBS<\/figure>\n\n\n\n

Russia is considering the notion that oil prices may be as low as $25 per barrel in 2020, the country\u2019s central bank said in its new forecast published on Monday, as cited by Reuters<\/a>.<\/p>\n\n\n\n

Russia\u2019s Central Bank has forecast in its macroeconomic forecast that oil could possibly hit that low due to falling demand for oil and oil products worldwide, as well as from disappointed global economic growth.<\/p>\n\n\n\n

The doom and gloom scenario was just one proposed by the bank. If that risk scenario actually materializes, Russia\u2019s inflation could increase to 7% or 8% next year, on the back of falling gross domestic product to 1.5%\u2013 2%.<\/p>\n\n\n\n

Russia is perhaps uniquely positioned to withstand low oil prices, although $25 per barrel is pretty bleak.<\/p>\n\n\n\n

One of the reasons why Russia is more impervious to low oil prices compared to its competition is that its currency weakens when oil prices fall. This provides some type of a cushion<\/a>\u2014at least to some extent\u2014for its lower oil revenues. Russian oil companies can pay their expenses in this weaker ruble, but still rakes in US dollars for its oil exports. Further allowing it to withstand lower prices, are that Russia\u2019s oil company\u2019s taxes are designed to be less as oil prices fall.<\/p>\n\n\n\n

So much so is Russia\u2019s ability to adapt to lower oil prices, that it actually struggles with higher oil prices, which dent demand for its oil. Russia\u2019s budget for 2019 was based on $40 oil.<\/a>Meanwhile, Saudi Arabia needs $80\u2014some say even $85\u2014per barrel.<\/p>\n\n\n\n

In August, Russia said its 2019 budget breakeven was at a Urals price of $49.20\u2014the lowest breakeven in more than a decade.  This has Russia and Saudi Arabia\u2014colleagues in the current production quotas designed to rebalance the market\u2014at odds, and likely working toward perhaps different goals.<\/p>\n","protected":false},"excerpt":{"rendered":"

Russia Considers Possibility Of $25 Oil Next Year Russia is considering the notion that oil prices may be as low as $25 per barrel in 2020, the country\u2019s central bank said in its new forecast published on Monday, as cited by Reuters. Russia\u2019s Central Bank has forecast in its macroeconomic forecast that oil could possibly hit […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3],"tags":[1970,426,11731,592,23083,694],"class_list":["post-48393","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","tag-central-bank-of-russia","tag-inflation","tag-julianne-geiger","tag-oil-price","tag-oil-price-com","tag-russia"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/48393","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=48393"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/48393\/revisions"}],"predecessor-version":[{"id":48394,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/48393\/revisions\/48394"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=48393"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=48393"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=48393"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}