It is common knowledge that the Russian economy heavily depends on the export of crude oil and natural gas. Based on the current situation in the global market of crude oil, the international expert community sure that if the price of crude oil goes below $22,5 per barrel, the Russian economy and financial system will crash.
Not so long ago, Bloomberg conducted an interesting survey by interviewing 30 economists on the impact crude oil has on Putin’s image and Russia’s economic and financial stability. The survey was conducted on August 24th-26th. They assume that the popularity of President Putin is destined to go sharply down once the price of crude oil drops below $30/b. On top of that, if the price goes down to $22,5/b and below, the Russian economy and financial system will eventually crash.
It is not a secret that Russia is heavily dependent on oil prices. Still, the Russians’ tolerance to poor standards of living is much higher than in any other emerging economy, not to mention developed economies. That’s why we can conclude that the economic situation in Russia is not the key factor determining Putin’s popularity.
At the same time, the Bloomberg interviewees assume that the Russian central bank is willing to wait till the Russian Ruble drops down to 80RUB per 1USD before taking urgent steps. This is the threshold when the bank is going to start selling foreign currency to back the national one.
The interviewed experts assume that the Russian GDP is going to drop by 3.7% this year, while the next year is going to show a 0,5% increase. These are revised figures. $ weeks ago, they expected a 3,5% drop this year.
At the same time, Masterforex-V Academy report that Brent oil closed the past trading week at $47,56/b. At this point, the price is trying to win back come more o the lost ground while trading close to $50/b.
