The Russian authorities do not rule out that due to the sanctions and the drop in oil prices, the ruble may fall significantly.
The Russian government considered the stress scenario of the macro forecast of the Ministry of Economic Development (MED), according to which the strengthening of Western sanctions and falling oil prices will lead to a fall in the ruble exchange rate, The Moscow Times reported on Wednesday, April 24.
It was noted that in the base case, calculated based on oil at $65, the Ministry of Economic Development expects Russia’s GDP to grow by 2.3% next year, at the same rate a year later and by 2.4% in 2027. At the same time , the ruble gradually weakened – to 98.6 rubles in 2025, 101.2 rubles in 2026 and 103.8 rubles in 2027.
Meanwhile, the Ministry of Economic Development’s stress scenario envisions a drop in Russian oil prices to $51.8 per barrel next year, and then to $45 in 2027.
In these conditions, according to the forecasts of the Russian authorities, the ruble will fall to 106.9 rubles per dollar in 2025, 115.1 rubles in 2026, and in 2027 it will fall to the minimums shown in the first weeks of the war in Ukraine: 120.1 ruble per dollar.
Cheap oil costs Russia about $100 billion in export earnings annually, according to estimates from the Ministry of Economic Development: in the stress scenario, sales of goods abroad in next year will bring only $365.7 billion, compared to $455.7 billion in the base scenario and $424. billion last year.
As a result, the growth of the Russian economy, estimated by Rosstat at 3.6% at the end of last year, will slow down to 1.5% in 2024, and will almost stop in 2025: GDP will increase by only 0.2%. Production and investment in industry will begin to fall completely – by 1.7% and 1.5%, respectively, in 2025.
We remind you that inflation in Russia at the end of 2023 will reach 7.4%.
As reported, in January, Russian President Vladimir Putin called the Russian economy “number one” in Europe. According to him, in terms of purchasing power parity, the Russians are ahead of all of Europe, but “per capita we still have to try”.
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Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.