The price of Brent oil dropped below $100 per barrel.
The media voice the opinion of experts who predict the consequences of Russia falling into the black oil hole, which was caused by rapidly falling oil prices and China’s refusal to buy Russian oil.
As Topnews wrote earlier, earlier analysts predicted that oil would rise in price to record values, and politicians called it one of the main allies of Russia. But already on February 25, the day after the start of the special operation in Ukraine, China temporarily abandoned Russian oil.
Experts, whose opinion is cited by “MK”, report that record March prices per barrel are falling down just as rapidly. By the middle of the month, the price dropped by $30 and the fall continues.
The reason is a new wave of coronavirus in China (5,000 infected, quarantine) and known geopolitical factors. As a result, now the price per barrel is $100 (March 7, $130).
According to analysts at Morgan Stanley, China’s GDP growth in the second quarter will decline to negative values, which will lead to a drop in oil demand.
Noting that the ruble has so far been fixed at 115-120 per dollar, 120-125 per euro, but the stability was affected by emergency measures of the Central Bank, including an increase to 20% of the key rate, regulation of exchange trading and currency intervention. But in the long term, the situation may repeat the scenario of 2014: the collapse of the ruble was provoked by falling oil prices and a package of Western sanctions.
If the trend of abandoning Russian oil from the EU countries, in the likeness of the United States, continues, then Russia will lose its current advantage in the form of oil windfalls.
Referring to information from Bloomberg, Russian companies already have problems with the shipment of oil sold in the Baltic ports. According to some versions, the United States is ready to lift the moratorium on the supply of Iranian oil, which will further reduce Russian oil revenue.
According to Maxim Biryukov, senior analyst at Alfa-Capital Management Company, despite the maximum discount on the Russian Urals brand, it is bought reluctantly. And senior analyst at Esperio Anton Bykov believes that the new sanctions may lead to a decrease in the annual GDP of the Russian Federation by 1.5-2%. Retail sales may fall by 7-10%, inflation will be up to 14-16%, the unemployment rate is 6%.
Against the background of the situation on the oil market and the reduction of funds from receiving exports, half of the country’s gold and foreign exchange reserve is needed, but Russia has been deprived of access to it.
“The domestic economy will have to go through the most severe crisis in the modern history of our country,” Bykov believes.
According to him, the peak critical values may be: Russia’s GDP – a drop of 6-8%, inflation – an increase of more than 20%, retail sales – a drop of 15%, unemployment – an increase of 8-10%.