• 4 minutes Projection Of Experts: Oil Prices Expected To Stay Anchored Around $65-70 Through 2023
  • 7 minutes Oil prices forecast
  • 11 minutes Algorithms Taking Over Oil Fields
  • 14 mintues NIGERIAN CRUDE OIL
  • 5 hours UK, Stay in EU, Says Tusk
  • 2 hours Socialists want to exorcise the O&G demon by 2030
  • 5 hours Blame Oil Price or EVs for Car Market Crash? Auto Recession Has Started
  • 15 hours German Carmakers Warning: Hard Brexit Would Be "Fatal"
  • 50 mins Nuclear Power Can Be Green – But At A Price
  • 2 hours Venezuela continues to sink in misery
  • 3 hours What will Saudi Arabia say? Booming Qatar-Turkey Trade To Hit $2 bn For 2018
  • 12 mins Chevron to Boost Spend on Quick-Return Projects
  • 17 hours WSJ: Gun Ownership on Rise in Europe After Terror Attacks, Sexual Assaults
  • 15 hours How Is Greenland Dealing With Climate Change?
  • 1 min Maritime Act of 2020 and pending carbon tax effects
  • 1 day Solid-State Batteries
  • 18 hours Trump inclined to declare national emergency if talks continue to stall - Twitter hides this as "sensitive material"
  • 23 hours Orphan Wells
How The Transport Industry Is Shaping Oil Demand

How The Transport Industry Is Shaping Oil Demand

The transport industry is evolving,…

OPEC Freeze Talks Boost Russian Ruble, Attract Investors

Crude oil pipeline

The oil price rebound that followed Russian President Putin’s announcement that the country is ready to join OPEC in output freeze negotiations pushed up the ruble substantially enough to make it more attractive to forex investors and increase Russia’s appeal as an investment destination as a whole.

According to Goldman Sachs, the Russian currency will continue to climb thanks to oil prices, but also thanks to plans by the central bank to further cut interest rates. Bloomberg quoted the bank’s governor Elvira Nabiullina as saying that the lower interest rates will strengthen the national currency and slow down inflation by making imports cheaper. This has been a major problem ever since the slide in oil prices began and Western sanctions for the annexation of Crimea kicked in.

The ruble first spiked after OPEC announced at the end of September it was going to agree to a production cut at its 30 November meeting. The announcement took the market by surprise, and then a couple of weeks later, Putin officially announced Russia’s readiness to join the talks, sending Brent and WTI above US$50 a barrel.

The price rise in crude has benefited Russia more than other producers that count as emerging markets, according to Bloomberg, and has made it more attractive for investors choosing between Russia’s borrowing rates and rates close to zero in developed markets. This is welcome news for Moscow, whose access to international financial markets has been curbed as a result of the sanctions.

The oil price rebound is far from sustainable, however, as it depends entirely on news from OPEC. Yesterday, for example, Brent and WTI fell after the cartel announced the duration of the freeze was not set. OPEC said, as quoted by Reuters, that it was “trying to reach a global agreement to cap production for at least six months,” refueling already rampant doubts about the effectiveness of a freeze. Six months may well turn out to be too short a time to rebalance the market, even if the agreement is reached.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News