Russian economy stable with oil price of $25 only for 6 months

Russian economy stable with oil price of $25 only for 6 months

If oil prices stay at $25 for two or three years, Russia will have big problems, said Russian Deputy Energy Minister Pavel Sorokin in an interview with RBC.

Russia will only survive the oil price of $25 for the next six months thanks to a flexible taxation system (about 65% of oil prices in the form of taxes goes to the budget, not to the accounts of oil companies), said Deputy Energy Minister Pavel Sorokin in an interview with RBC.

But if oil prices remain at $25 for two or three years, it will create great problems for the Russian economy, explained Pavel Sorokin.

According to the Russian Ministry of Energy, the price of oil will change depending on developments in the coronavirus and the volume of production on the oil market. Now the market is panicking and the price is falling to the level where the “supply destruction” begins, said Sorokin in a conversation with RBC.

The price of the Brent oil fell by 30 percent after Russia and OPEC+ countries failed to agree on the terms of the deal to reduce oil production on March 9. On March 27, Brent was sold at $ 26 per barrel.

Source: belsat.eu

Published: 29-03-2020