Posted on 08/18/2014 12:25:58 PM PDT by Tailgunner Joe
Russian Urals crude weakened for an eight straight trading day on Monday due to weak European refining demand, falling well below $100 a barrel for the first time in a year in a move to increase the pain for Russian state finances amid Western sanctions.
Russia has balanced its budget at $114 a barrel this year as President Vladimir Putin is ramping up social military spending amid a conflict in Ukraine, which sent relations between Moscow and the West to their worst since the end of the Cold War.
Sanctions are expected to slow new Russian oil projects, compounding a decline in output in the last months from the world's largest producer.
Global oil prices have been falling despite the conflict in Ukraine and violence in Iraq due to poor demand from the weak global economy and booming U.S. oil supplies.
"The geopolitical premium has fallen close to zero," said analysts from Nordea bank.
Analysts said declining oil prices would heavily weigh on the Russian stock market and the rouble, which is already trading near its all-time lows. Russia's $2 trillion economy depends on energy-related taxes for half its budget revenues.
On Monday, Urals crude in the Baltic traded at below $98 a barrel, its lowest since May 2013, the last time Urals traded under $100 per barrel for a prolonged period of time.
In the Mediterranean crude market, where oil supplies are slightly than in the Baltic, Urals was trading at below $99 a barrel.
(Excerpt) Read more at in.reuters.com ...
Hey, just print money when you need it, that’s what we do!
Latin American drug lords, Muslim war lords, and Chinese overlords don’t trust the rouble as a reserve currency.
Print more roubles equals hyperinflation.
Look at this from the effect it has on Russian foreign expeditions. Low oil prices have the secondary effect of REDUCING the Russian Federation’s capability to maintain a military presence in another sovereign nation. The falling oil prices are because there is MORE oil being produced than is consumed on a day to day basis, that is, an excess supply. One of the factors that is contributing to this excess world supply is the domestic production of crude within the USA, through the “fracking” process. Every barrel produced here is one less purchased from the world supply.
Economic sanctions by overwhelming the capability of the sanctioned nation of export their products profitably is every bit as effective as an embargo, and probably easier to apply.
But that was purely accidental on the part of the Current Regime now squatting in the White Hut, as they never meant for any of their sanctions to have any real effect.
Too bad our OmegaMan-in-chief would not capitalize on the situation to collapse the oil prices.
You know, like President Ronald Reagan did to weaken and eventually destroy the Soviet Union.
What’s a ride into space going to cost America if sanctions continue? Assuming of course that there’s any room available for an American astronaut. And what are the other implications of our reliance on Russia for ancillary delivery capabilities?
We have no manned spaceflight capability. The U.S. pays Russia $70 million per Soyuz seat.
A related article FYI:
http://www.universetoday.com/110006/iss-nasa-and-us-national-security-dependent-on-russian-ukrainian-rocketry-amidst-crimean-crisis/
In other news, Obama held a news conference stating that we will ensure our world leadership position in outspending Putin, by building golf courses for illegals and their families.
Putin will fall suddenly ill and die in his sleep, just watch.
someone needed to tell putin that he needed to first be economically independent before he could go foreign adventures.
Putin can only print rubles and no one wants these.
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