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Page added on December 15, 2015
Russia is bracing for $30 oil
Russia is planning for oil prices to drop to $30 per barrel in 2016.
The country’s top finance official, Anton Siluanov, said the government must be prepared for prices to fall further in 2016 as the global glut grows and new supply — for example from Iran — enters the market.
“Everything indicates that low oil prices are likely to dominate next year. And it is possible that at some periods [the oil price] will be $30 per barrel,” Siluanov was quoted as saying by Russian state-run news agencies.
That would spell more pain for Russia. Oil and gas exports make up almost half of government revenue.
Oil futures were trading at their lowest level in nearly seven years on Monday, sliding below $35 per barrel.
Related: Russians are making far fewer trips abroad
Russia is planning for oil to trade between $40 and $60 per barrel over the next seven years.
Its 2016 budget is based on an oil price of $50 per barrel, Siluanov said. “Therefore, we must be prepared for difficult times,” he was quoted as saying.
Russia is forecasting its budget deficit to rise to 3% of GDP in 2016. That’s the maximum Russian President Vladimir Putin has said he will allow. Lower oil prices would make spending cuts inevitable.
The International Monetary Fund expects Russian GDP will shrink by 3.8% this year and by another 0.6% in 2016.
Meanwhile, the Russian ruble is sliding again, trading at 70.5 rubles per dollar, the lowest in four months and near last year’s record lows.
Russia has been among those hit by OPEC’s decision to keep pumping record amounts of oil, hoping to squeeze out higher-cost producers.
Russia, Venezuela, Nigeria and other oil producing countries have been lobbying for the Saudi-led oil cartel to cut production to lift prices. Their pleas were not successful — OPEC failed to agree a production target at its latest meeting.
27 Comments on "Russia is bracing for $30 oil"
Truth Has A Liberal Bias on Tue, 15th Dec 2015 7:49 pm
At budget deficit 3% of GDP IS NO PROB. Putin can handle that standing on his head. 3% is as about as good as ‘Merkia can do these days. If 3% is a bad year then Russia will be just fine. After all, Russians are a hard people. ‘Merikans are soft flabby little men for the most part.
Truth Has A Liberal Bias on Tue, 15th Dec 2015 7:49 pm
http://www.tradingeconomics.com/united-states/government-budget
dissident on Tue, 15th Dec 2015 7:51 pm
Funny how in NATO deficit financing is the normal operating procedure, but for Russia this is some sort of existential crisis. BS.
If CNN and pals cared to do actual journalism instead of propaganda, they would notice how the ruble exchange rate has dropped fast enough to offset the oil price drop. The cheaper the oil the higher the ruble to dollar exchange rate. The Russian economy and budget is in rubles and not dollars. The only serious issue for Russia is that imports become more expensive.
Anonymous on Wed, 16th Dec 2015 4:24 am
I am sure Russia will not whither and die, despite the fervent hopes of the lunatic neo-liberal crowd. Russia survived the first attempt to crush them in the 90’s. A lessor people or nation would not have made it through that. This time, Russia is better prepared to weather this most recent US attack. Driving down oil prices is going to hurt the US as much, if not more so than Russia. We can already see signs of this now, even if they are only reluctantly acknowledged. The world wont come to an end over low oil prices and neither will Russia.
So deal with it CNN…..
makati1 on Wed, 16th Dec 2015 5:44 am
dissident, you understand the situation very well. CNN is pure propaganda and they never actually mention that oil recovery and refining costs in Russia are priced in Rubles, not dollars. Putin is using this time to force Russia to become less dependent on imports and more self-sufficient. After all, it still has abundant resources for it’s small population.
And nothing like high prices of imports to stop people from buying. I know that the higher dollar is making the price of US imports here in the Ps more and more out of reach. For example:
Canned whole kernel corn
US = P52 ($1.11)
Thai = P 27 ($0.57)
and the Thai corn is actually better than the US corn.
rockman on Wed, 16th Dec 2015 6:28 am
FYI: Russian oil earnings today are the same as they were in early 2009 and 2006. And that current revenue is 3X what it was in 2002…$225 BILLION vs $75 BILLION.
Don’t cry for me Argentina…I mean Russia. lol
Davy on Wed, 16th Dec 2015 7:04 am
I love how the anti-American line up to bash the Americans. I love how the articles fly on this site that are anti-American either by posting stupid mainstream American articles that are feasted upon by anti-Americans or good hard hitting anti-American articles that tell a true story. The problem is the tone set by unbalance, unfair and agenda driven groups that accumulate as they do on this site.
I need only point to where the discussion have been and where they are now. The Brics are falling apart. They were according to many of the people above supposed to decouple from the west’s status quo and destroy it economically, militarily, and socially. You name it these Brics where going to rise like a phoenix for a new age.
Putin was supposed to be peace loving and rational. Now Putin is mired in the Mideast with oil prices dropping to unhealthy and dangerous levels for a country engaged in a military renaissance. This has to be paid for and when you are a country that is oriented more to resource extraction then diversification this is a problem with commodities tanking. Putin is killing civilians and practicing genocide just like the Americans. Yet, that is ok because Putin is a symbol of American defiance. I admire Putin. He is a strategic genius. He is eloqantn and the most capable leader in the world today. Putin is also a killer and the most corrupt man in the world. Putin has coopted a country. His wealth and position in a mafia country proves he has killed, lied and stolen.
What has the anti-Americans so hot and bothered is the US may be the last dirty shirt to bight the dust. The US is likely going to take a dive in 2016 but who knows and they hate that. I could give a shit really. We are all going down. I wish the US was Greece now getting the hammer of collapse with a still functioning world. Greece will have a population that is stronger in adversity once the global system collapses.
You all can brag about the Russians being strong but why is their society suffering the same ills as the west. In many cases the ills are worse. Russia is a corrupt mafia country. Drug abuse and alcoholism is rife. How is this much different for the continuous criticism we get here for drug addition and dependence we see directed at the US? The US is a mafia too but at a different level.
The US is a country of 300MIL people spanning a continent of multiple physical terrains and resulting lifestyles. It is a country of significant immigration as well. I will readily acknowledge 50% of Americans are near worthless as many of you indicate ad nausea. There is another 25% that is solid as a rock and tough. There are the best of the human race in the US too but the anti-Americans can’t bring themselves to acknowledge this.
It is the excessive and driven message of blame and complain that is denial. If you are driven to get a message across you are ignoring reality. Many of the anti-Americans above are as bad as the US mainstream media that practice the same. The reason these activities are practiced is they are effective propaganda and propaganda has power. These efforts also satisfy resentment, hatred, and revenge. Many times these destructive human emotions are for completely different reasons but it feels good to find a whipping boy to lynch.
This is the part I love. Listen to me then watch the responses. It never fails just like birds in the bushes singing. The US is the biggest problem to world peace at the moment. The US “American dream” has killed the world especially now that Asia has embraced it and taken it to new levels of absurdity. Americans are suffering the ills of affluence and we are now seeing the rest of the world get there. The US got their first in the 20th century. It has had longer to become fat, lazy, and corrupted by affluence. This descent began as soon as it became the military and financial power it did post WWII. It has been downhill ever since.
I just ripped my country a new asshole but you know what will happen? The anti-Americans will come on here and call me a flag waiver. They will tell me I am supporting this evil. I am deceived and deluded. Eventually they attack me personally as a 1% er and on and on. I have heard this so many times it is silly.
The people that say these thing are themselves deluded. They just like pointing their fingers and hiding from their own misplaced righteousness. Hate, resentment, and anger are lustful and provide wonderful natural dopamine. I need only point to the failure of their message at a certain level. Their Bric heroes are crashing and burning just as America is. We are in this together not separate. Like it or not you and your heroes are going down too.
shortonoil on Wed, 16th Dec 2015 8:36 am
An extractive resource company that is not replacing its reserves is going out of business. By definition! For 2013 the petroleum industry replaced 4 Gb of the 32 Gb it extracted. The present price structure is inadequate for the industry to replace its reserves, and cover its operating cost. When the fields now being operated are depleted out production will cease; that will be, most likely, no more than 6 to 7 years.
Further more, the price of oil is now capped as a result of its ongoing depletion. Petroleum can sell for no more than the amount of economic activity it can power. No one is going to be using $2 of oil to produce a $1 in goods, and services. We have calculated that cap as an ongoing time function, and published it here:
http://www.thehillsgroup.org/depletion2_022.htm
The petroleum industry constitutes 38% of the world’s economy, as it fails so also will the remainder of that economy. Expect major disruptions, and massive economic contractions as the petroleum industry is now operating in its shut down phase!
http://www.thehillsgroup.org/
GregT on Wed, 16th Dec 2015 8:59 am
“I love how the anti-American line up to bash the Americans.”
Give it a break Davy. It’s beyond childish already. People are telling it like they see it, and they are mostly right.
marmico on Wed, 16th Dec 2015 9:17 am
The petroleum industry constitutes 38% of the world’s economy
Bullshit. Petroleum constitutes 38% of the world’s primary energy.
In the U.S. since 1970 primary energy dollars have ranged between 5.8% and 13.3% of total economy dollars.
http://www.eia.gov/totalenergy/data/monthly/pdf/sec1_17.pdf
2015 will print near the lower end of the range.
ipissonyouyoungtards on Wed, 16th Dec 2015 9:23 am
I piss on your ugly faces,stupid youngtards
GregT on Wed, 16th Dec 2015 9:25 am
Money (dollars) is a claim on future production. Production requires energy. Therefore, money is a claim on future energy production.
Take energy out of the equation, no money, and no economy.
GregT on Wed, 16th Dec 2015 9:35 am
“I piss on your ugly faces,stupid youngtards”
And we piss on your ugly face too, friend. Nice to meet you.
GregT on Wed, 16th Dec 2015 9:45 am
And for future reference ipissonyouyoungtards, your customs are strange to us.
Here on the planet Earth we normally greet each other with a simple hello, or good day.
GregT on Wed, 16th Dec 2015 10:23 am
While the act of peeing on one other is carried out by a small percentage of human beings, it is generally considered to be an act of sexual deviancy.
You can read about it here, if you are so inclined:
https://en.wikipedia.org/wiki/Urolagnia
Davy on Wed, 16th Dec 2015 10:40 am
Russia and the rest of the world might be waiting for better times. Looks like the economy is showing more signs of decline:
http://www.zerohedge.com/news/2015-12-16/baltic-dry-crashes-new-record-low-china-demand-collapsing
Boat on Wed, 16th Dec 2015 10:41 am
Davy
I will readily acknowledge 50% of Americans are near worthless as many of you indicate ad nausea. There is another 25% that is solid as a rock and tough.
And where did you get those numbers. What is the criteria? Thinking your smarter certainly dosent mean the output of is any good as demonstrated by your post. When did you become so arrogant as to decide what is a good American.
GregT on Wed, 16th Dec 2015 10:47 am
“Thinking your smarter certainly dosent mean the output of is any good as demonstrated by your post.”
Engrish prease.
shortonoil on Wed, 16th Dec 2015 11:24 am
The Baltic Dry Index just hit a 30 year low, US manufacturing is crashing, the FED is speculated to drain $1 trillion from the economy to drive their expected 0.25% interest increase, and WTI is back to $35. We are expecting an avalanche of bankruptcies in the oil industry over the next year. It looks like a train wreck up ahead, and no one has done a thing to prepare for it!
The village idiot up above posted some kind of garbage about US dollars, or something when we were talking about energy. If anyone is intereseted the IEA says:
Total world energy production – 524 quad BTU
Total energy from oil – 194 quad BTU
2012 figures. The EIA’s more recent data has de-evolved into an almost totally useless jumble of interactive junk. Guess they thought they would make it pretty; they did. Pretty useless!
Davy on Wed, 16th Dec 2015 11:30 am
Bowtie, pulled them there nummers out of my ass and they felt good so I used them. This type of activity is pretty much normal with a majority of others here on our board so I felt it OK. How about you bowtie what’s your thoughts on percentage of people that are near worthless in our great country?
Bowtie, I am smarter than some but dummer than others. At least I don’t deny it. Arrogance, hum, hum, yes I am, sorry, but I can’t help it with so much dumbass in the world.
Newfie on Wed, 16th Dec 2015 12:29 pm
“Russians are making far fewer trips abroad.”
Good. Now I can go to Pattaya and enjoy myself without hordes of half-civilized Slavic dimwits fornicating in public on restaurant tables or in front of Buddha statues.
Apneaman on Wed, 16th Dec 2015 3:25 pm
Putin Throws Down the Gauntlet
“So what choice does Putin have?
None. He has no choice. His back is against the wall. He has to fight. No one in Washington seems to get this. They think Putin can throw in the towel and call it “quits” at the first sign of getting bogged down. But he can’t throw in the towel because Russia’s facing an existential crisis. If he loses, then Russia’s going to wind up on the same scrap heap as Afghanistan, Iraq or Libya. You can bet on it. So the only thing he can do is win. Period. Victory isn’t an option, it’s a necessity.
Do you think that Putin and his advisors have had their heads in the sand for the last 15 years, that they haven’t noticed the US rampaging around the globe bumping off one country after the other leaving behind nothing but anarchy and ruin? Do you think they don’t know that Russia is on the top of Washington’s hit-list? Do you think they haven’t noticed NATO inching closer to Russia’s borders while foam-at-the-mouth politicians in Washington wave their fists and growl about Hitler Putin and evil Russia?”
more
http://www.informationclearinghouse.info/article43734.htm
dissident on Wed, 16th Dec 2015 4:57 pm
Davy, the US regime bootlick and his BS indignation about “anti-Americanism”. Sod off, bloody hypocrite. It’s OK for you to be a foaming at the mouth anti-slav, along with Newfie, but nobody has the right to question your precious regime propaganda narratives. In your sick dreams, sunshine.
Davy on Wed, 16th Dec 2015 5:47 pm
Thanks dissy, you proved my point perfectly.
makati1 on Wed, 16th Dec 2015 8:14 pm
It is so easy to put down the ‘exceptional’ country and it’s dumbed down sheeple. Daily events there provide all of the facts needed.
“America’s painkiller epidemic grips the workplace”
“As Lead Poisons City’s Children, Mayor Declares State of Emergency”
“Poll: 71% Say Shooting Violence Now Normal Part of American Life”
“Report: Campus Free Speech Might Be Spreading, But the Federal Government Wants to Stop That”
“Donald Trump Hits 41 Percent Support and Widest Lead Yet in New National Poll”
“Hillary Clinton allies plan to troll Donald Trump on Snapchat”
http://ricefarmer.blogspot.fr/
LMAO
Apneaman on Wed, 16th Dec 2015 8:39 pm
The Empire Files: ‘This Ship is Sinking’ Says Former Bush Official
“Abby Martin interviews retired U.S. Army Colonel Lawrence Wilkerson, former national security advisor to the Reagan administration, who spent years as an assistant to Secretary of State Colin Powell during both Bush administrations. Today, he is honest about the unfixable corruption inside the establishment and the corporate interests driving foreign policy.
Hear a rare insider’s view of what interests are behind U.S. wars, the manipulation of intelligence, the intertwining of the military and corporate world, and why the U.S. Empire is doomed.”
https://www.youtube.com/watch?v=kgig1QVU2lY
JuanP on Thu, 17th Dec 2015 3:31 pm
https://www.rt.com/business/326280-putin-oil-russian-budget/