Russian Government Readies for Prospect of $30 Oil

Reuters

MOSCOW, Sept 21 (Reuters) - Russia's government has been discussing ways to tackle the tough economic environment if oil falls to as low as $30 per barrel next year, RBC daily reported on Monday, citing government sources.

That scenario was discussed at a government meeting chaired by Prime Minister Dmitry Medvedev earlier this month, the newspaper cited two unnamed government sources as saying.

The price of oil is crucial for the Russian budget, which normally generates half of its revenues from oil and gas sales. The Russian Economy Ministry forecasts that oil prices will average $52 per barrel in 2015 and $55 in 2016.

On Friday, a deputy energy minister said if crude falls below $40 a barrel from around $50 currently, Russian oil production may drop.

Oil prices rose by around one percent on Monday as U.S. drilling slowed and analysts estimated that $1.5 trillion worth of planned American production investment was uneconomical at prices of $50 per barrel or lower.

(Reporting by Vladimir Soldatkin; Editing by Christian Lowe)

Copyright 2017 Thomson Reuters. Click for Restrictions.

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