Greater impact on the Russian currency will have problems with the budget, geopolitics and external debt.
Brent crude during trading on Tuesday broke above $53 per barrel — the highest figure for the year. So the price of raw materials reacted to the statement by Russian President Vladimir Putin that our country is ready to support the agreement by OPEC to limit production. The Minister of energy of Saudi Arabia expects oil prices to $60 per barrel by the end of the year. However, the ruble is not only not strengthened, but lost to the dollar and the Euro. Its exchange rate declined against the currency basket by approximately 1%. According to experts, even under favorable factors for oil further strengthening of the ruble will be constrained by the peak of payments on external debt, problems with the budget, expectations for rate changes by the Federal reserve system (FRS) and the deterioration in the geopolitical situation.
States of OPEC (Organization of countries — exporters of oil, which includes 13 countries in the Middle East, Africa, Asia and South America) for several years trying to reduce production quotas to maintain prices, but to agree yet. The lack of a unified position in the cartel contributed to the collapse in oil prices below $30 in the beginning of last year. The decision to reduce production failed to take over Iran, who had just returned to export markets after the lifting of sanctions. The latest meeting of OPEC member States was held on 2 June in Vienna. Wasn’t the quota for the production, but decided not to increase oil production. At the next meeting, to be held in late November, historic agreement can finally be reached.
As reported by Reuters, citing sources in the cartel, the OPEC countries had reached an agreement to limit oil production at the level of 32.5 million barrels. Monday in Istanbul, Russia’s intention to participate in the agreement said Vladimir Putin. He said that Russia is ready to accede to joint measures to limit production and calls for the other oil exporters. He also expressed the hope that the OPEC meeting in November, “this idea will be embodied in specific arrangements”. As explained later, the Minister of energy Alexander Novak, it is not about production cuts, and its frozen at the current levels.
Analyst VTB24 Alexey Mikheyev believes that the freezing of production possible.
Factor OPEC is not the only thing that affects the price of oil. Five consecutive weeks of falling oil inventories in the US, reduced production in the United States, China, India, Venezuela and Gabon. And this is clearly the medium-term trend, caused by underinvestment in the sector last year and a half. Also, some short-term impact of hurricanes in the Gulf, — the analyst listed reasons why oil prices can still grow.
Will it affect and how is the ruble, which has always followed the movement of commodity prices? The increase in oil prices is certainly positive for the ruble, analysts of Sberbank CIB. However, they note that while it is difficult to understand whether these statements are supported by real actions.
— In the near future oil prices will be difficult to grow even stronger. The lower pair dollar–ruble meets increasingly strong resistance levels. While there is no certainty that can be reached the mark of 60 rubles to the dollar — predict at Sberbank CIB.
Moreover, the dependence of the ruble on the price of oil declines, the analyst of Raiffeisenbank Denis Poryvai.
— Change oil for $1 now is about 37 cents, but it could be 20 cents. That is, even if the price of oil will rise by $10 to $60, we will see the strengthening of the ruble against the dollar by just 2-3 rubles. Now 62, will be conditionally 59 rubles per dollar. This is a very minor change, — said Denis Poryvai prospects of the national currency.
Among short-term factors for the ruble economists also call and purchase “Rosneft” “Bashneft”. To do this, “Rosneft” will soon have to sell the currency on 300 billion roubles. This, according to the first Deputy Chairman of the Central Bank Ksenia yudayeva, may have a small impact on the ruble, which temporarily slightly stronger, “but no more”.
Even in a favorable situation, the ruble will not be able to grow significantly, analysts say. They mention several factors that will impede the strengthening of our currency: the peak of foreign debt payments in December, the expectation of rate hike from the U.S. Federal reserve, as well as the need of budget in a weak ruble.
Chief analyst at Promsvyazbank Ekaterina Krylova when crude cost $47-50 considers a fair rate of 65-68 rubles per dollar.
— Additional pressure on the ruble may occur in December in connection with large payments on external debt companies and banks ($17 billion). Also in the fourth quarter will operate the budget factor. Due to the lower prices of oil formed a considerable deficit, mainly the result of lost revenues, while expenses are not being cut, she explains.
Until the end of the year, the ruble, will likely be in the range of 62-65 rubles to the dollar in 2017 the positions of the national currency will also remain strong, more optimistic, the main analyst of the Bank Natalia Vasilyuk.
— A serious weakening of the ruble is possible with the increase in geopolitical tensions, in particular, a sharp aggravation of the situation in Syria and the possible introduction of new sanctions against companies or sectors of the economy. In addition, in the event of serious problems in China’s economy, the ruble is also under attack. But such scenarios are unlikely — sure analyst.
