- Ruble expectations are being revised The decreasing oil prices seen for over a month now are bad news for Russia as the “black gold” provides most of the country’s income.
Libya’s oil production, which reached its maximum in recent years, as well as the high level of U.S. oil reserves, are creating a downward pressure on oil prices. In addition, the OPEC deal on oil production cuts, which failed to meet market expectations, is adding to that pressure.
Meanwhile, the U.S. Senate has approved a proposition for new sanctions on Russia regarding its activities in Ukraine. The Senate is limiting the powers of the Trump administration over the easing of sanctions.
Finally, after the U.S. Federal Reserve’s (FED) decision last week to increase the key interest rates by 0.25 percent, experts on Russia have started revising their forecasts on the Russian ruble.
Russian Minister of Economic Development Maxim Oreshkin said that while the recent FED decision could increase capital outflow from Russia, they also expect the ruble to drop to 68 on average against the dollar by the end of 2017. The ruble currently stands at 57.5 against the dollar.
Putin criticizes sanctions again
Russian President Vladimir Putin replied to questions from the Russian public, in his traditional TV show, Direct Line.
While the current state of the Russian economy was among the most popular question to be asked, the U.S. Senate’s recent decision to extend sanctions received interesting comments from Putin.
The Russian president claimed that the sanctions imposed on Russia were purely a tactic to gain advantage over the rise of Russia, which he said had occurred throughout the entire history of the country, even as the Union of Soviet Socialist Republics (U.S.S.R.).