The price of Brent oil fell below $40 for the first time in 7 years

The price of Brent oil fell below $40 for the first time in 7 years

Moscow. December 8. The prices for oil imports switched from growth to decline on Tuesday, with Brent quotes fell below $40 a barrel for the first time since February 2009, reported Bloomberg.

The January futures for Brent crude on London’s ICE Futures exchange to 16:45 MSK fell by 2.1% to us $39,88 per barrel.

Futures prices for WTI crude oil for January in electronic trading on the new York Mercantile exchange (NYMEX) fell 2% to $36,9 per barrel.

On the eve of both brands fell by more than 5% to close trading at the lowest level since early 2009.

Oil becomes cheaper on fears of the worsening of the fuel surplus in the market after the Organization of countries-exporters of oil last Friday decided to keep the actual oil production volumes, comprising about 31.5 million barrels a day.

It is noted that at a price of $40 per barrel, the Russian authorities expect options macroeconomic stress scenarios, even without revealing their details.

The Ministry of Finance of the Russian Federation, the losses of the budget in 2016 at current oil prices and the exchange rate can be 2% of GDP. “The loss of budget revenues next year at today’s oil prices and the exchange rate, according to the Finance Ministry, can be of the order of 2% of GDP. This means that to complete the task the message of the President – to keep the deficit within 3% of GDP – will require measures to raise revenues, a more conservative approach to spending and measures to stimulate economic growth,” he said earlier Tuesday, Finance Minister Anton Siluanov.

The head of the Ministry of economic development Alexei Ulyukayev on Monday made a forecast that the high volatility in the oil market will continue for another two to three quarters, but then prices will go up, and the results 2016 baseline forecast of the Ministry on the price of oil at $50 a barrel is quite real.

The Minister recalled that was calculated and the so-called pessimistic variant of the forecast, which assumes average annual oil prices at $40 per barrel in 2016. “In this version we do not go to positive GDP dynamics, industrial, investment and retail in 2016”, – he noted.

“But we don’t see (in conservative scenarios) principal risks-for example, risks to macroeconomic balance in General, risk of default of budget or undermine the banking system. The Russian economy as a whole is adapted. It passed the shock. We were able to considerably reduce costs, to improve manageability of the companies. And margin, as we understand, it’s big enough,” said the speaker, commenting on possible risks in the pessimistic scenario.