Russia’s central bank said on Friday that oil prices and production levels used by Moscow’s finance ministry to draw up a new budget are too optimistic as the Russian government tries to boost revenue from energy exports, Reuters reported.
Russia, which is also trying to shore up its foreign exchange reserves after historic Western sanctions limited its access to global financial markets, plans to reintroduce a budget rule under which oil export revenues are transferred to the sovereign wealth fund when I prices cross a certain threshold.
The Ministry of Finance suggested using a reference price of $60 per barrel of crude oil and a daily production of 9.5 million barrels as parameters.
“The price of base oil and oil production seem too high to us in the new revised budget rules,” the Central Bank of Russia said in a report.
The previous budget norm was suspended after Western countries imposed tough sanctions due to a “special forces operation” launched by Vladimir Putin on February 24. Oil export revenues were supposed to be recalculated starting at a price of $40 per barrel with an annual increase of 2%.
The Central Bank of Moscow says that the use of these overly optimistic estimates of the Ministry of Finance may jeopardize the construction of the consolidated budget.
Disappointing prospects for Russian oil exports
The differences between Russian officials responsible for the country’s economy arose in the context of the fact that Moscow has already reduced by 30% the price of oil it offers for export to Asian countries, where it is trying to redirect its sales after In early June, the European Union imposed an embargo on Russian oil
Another concern of officials in Moscow is the prospect of lifting Western sanctions against Iran, as Tehran’s government is already making plans to replace Russia in the European oil supply market.
Turkey, which has not joined EU sanctions against Russia, has doubled its imports of Russian oil since the start of this year, but may now have a more profitable alternative on its eastern border.
Ankara increased its imports of Russian oil to more than 200,000 barrels per day, compared to just 98,000 barrels in the same period in 2021.
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Source: Hot News RO
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