Page 89 - RusRPTOct20
P. 89
October-December 2020
The Russian ruble remained under pressure as the ruble to euro exchange rate on September 21 reached RUB90.4 for the first time since February 2016, while the ruble to US dollar rate reached a one-week peak of RUB76.55. As reported by bne IntelliNews, at the beginning of September the ruble came under pressure due to political instability in Belarus, new sanctions fears after the poisoning of the dissident Alexei Navalny and falling oil prices.
The external value of the ruble has traditionally tracked – almost slavishly – changes in world crude oil prices. Since early June, however, the ruble has lost significant value without a corresponding drop in crude oil prices. This week, the price of crude oil fell rapidly again, with the price of Urals-grade crude falling below $40 a barrel for the first time since June.
Since the beginning of June, the ruble has lost 8% of its value against the US dollar and 15% of its value against the euro. At the same time, the price of a barrel of Urals crude has risen slightly more than 2%. Market analysts report that exchange rates have been under pressure from general uncertainty about conditions in emerging economies and the impact of the Covid-19 pandemic. In addition, the situation in Belarus in recent weeks and the poisoning of opposition leader Alexei Navalny have increased the likelihood of new sanctions against Russian persons and entities. Moreover, the fate of the just-renewed production cut agreement of OPEC+ countries, which takes about 10mn barrels of daily production off the market, looks uncertain. Previous versions of the voluntary agreement succeeded in compelling major oil-producing nations to restrict output.
89 RUSSIA Country Report October 2020 www.intellinews.com
