A liquefied natural gas plant operated by Sakhalin Energy at Prigorodnoye on the Pacific island of Sakhalin, Russia, is shown in this July 15 2021 file photo. Picture: REUTERS/VLADIMIR SOLDATKIN
Prices would have to stay around current levels of $90 a barrel this year boost revenues that much, according to economists’ estimates. With oil at $100 a barrel, which some forecasters say may not be the limit, the total would be closer to $73bn, bringing the dollar value of Russia’s total earnings close to peaks last seen about a decade ago. Bloomberg Economics forecasts the windfall could reach as much as $80bn at $100 oil.
“Russia’s fiscal position is so super-stable that even with more modest oil prices, it’s hard to compromise it in the current situation,” said Sofya Donets, economist at Renaissance Capital in Moscow. By law, the bulk of the windfall will go to the National Wellbeing Fund, most of which is held in gold and foreign currency by the central bank as part of its reserves. But some of the money can be used for infrastructure and investment projects to help sustain growth even as sanctions pressure cuts off investment inflows. The government is currently planning to spend about 2.5-trillion roubles from the fund on projects over the next several years.
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