Volodymyr Putin is ready to continue the war against Ukraine. Even though the Russian people are still suffering, there is not enough pain to force the newly elected president to change course.
RBC-Ukraine reports this as reported to Reuters.
As indicated in the material, Putin could reconsider your decision, as if the decline changed the speed of Russia's nafta revenues.
However, since the need for carbohydrates will be deprived to such an extent, the Russian order will have to put pressure on its citizens. The economy is overheating, and Putin, who has smartly rejected the new six-term term to extend his 24-year rule, is investing even more pennies in the war. Spending on defense, which is budgeted at 118 billion dollars, has tripled since the start of the war. Inflation is at 7.7%.
The Central Bank raised interest rates to 16% and stated that the official policy must avoid the high length of the “three-year period” in order to reduce inflation to silt indicator in 4%. The order has delegated control over the government to capital in order to boost the ruble.
It will also be necessary for the government to make fiscal adjustments in order to bring the internal economy into line with production. First on the list, above everything else, is the promotion of donations aimed at wealthy people and companies. Putin has already given a signal about this. If such decisions are to be unpopular among those who act, we will not provide support
Harmati instead of olia
Putin boasts that last year the growth of the Russian economy was 3.6%, even more than any of the rich democracies of the “Great Family”, which support Ukraine. GDP will grow by 2.6%, which is expected to grow by 1.1%, the International Monetary Fund predicts.
Although the main picture is not as good as the numbers seem. First of all, the military economy, by its nature, does not produce goods that basic people can afford. As a result, most of the national income will go directly to the production of tanks and shells, while consumer goods and services will cost less than pennies, according to Tim Yesh, strategist at RBC BlueBay Asset Management.
The order of depriving the population of the economic costs of the war, which resulted in raiding of its national wealth fund to finance the budget deficit, which became 3.7% of the GDP of the past. However, it is not stable, the fund's remaining liquid assets have fallen more than double since Putin invaded Ukraine twice, and now become less than 2.7% of national income. So, the foreign economy will continue to incur new expenses. This will result from the increase in taxes, inflation, high interest rates and shortening of payments.
Moreover, the war is detrimental to Russia’s mid-Russian prospects. The latest sanctions are enhanced by advanced technologies. Productivity, as Putin plans to increase, fell by 3.6% during the first period of the war. Investments fell to 19.7% of GDP in 2022 from 21.4% in 2017.
According to the data of the US government, approximately 315 thousand Russian military servicemen died or were wounded, so as the independent data Re: Russia estimates that over 800 thousand people were deprived of the country until the end of the past. This twist in the brains of young and well-educated people is another hazard for the economy.
Russian roulette
Although the economy seems to be in a state of stagnation, the President of the Russian Federation does not agree with any domestic financial exchanges wives who will overcome the prolongation of the war. And in this case, he is not yet subject to any external restrictions.
Putin managed to see that Russia, as before, makes a lot of money on carbohydrates. Regardless of the fact that Ukraine’s allies have imposed an embargo on their naphtha, and Europe has found an alternative to its gas, in 2023 Russia will have a small surplus in its gas flow amounting to 51 billion dollars. Although this figure is less than a record 238 billion dollars from the previous year, Moscow is still in the black.
The situation could change if Ukraine's allies could reduce Russia's export revenues, leading to shortages, according to Jacob Nell, a senior research scientist at the Kiev School of Economics. I firmly believe that Russia, and before it the Radian Union, faced a crisis when the current situation became negative.
Due to the need, Russia could reduce imports a little, according to Nella’s estimates, exports could fall by about 80 billion dollars, before Putin will have to go to extreme lengths to stabilize the economy. Nearly $30 billion of this price could be clawed back for the expansion of the gas embargo, as well as for the export of precious metals such as nickel. However, the bulk of the output may be taken away for the price reduction that Moscow charges for its naphtha, up to 50 dollars per barrel.
It’s easier to say than to earn. At the end of 2022, the “Great Family” and other allies introduced a price limit for Russian naphtha of 60 dollars per barrel. Prote naphtha of the Urals grade is trading at about 71 dollars per barrel, which is about 14 dollars lower than the price of Brent grade. Although the acquired States would impose sanctions on tankers that disrupt the price gap, Russia can often bypass them, victorious against its powerful fleet.
Ukraine’s allies may be in trouble if world prices for naphtha plummet. Without which, they will need to make very harsh moves in order to reduce the price that Russia charges for its naphtha, up to 60 dollars, not even about 50 dollars.
The key to achieving the price will be a change and India, the largest importer of Russian sea oil, stop paying the price more for the established boundary, like Nell. This country could eliminate the tax on cheap oil, and oil refineries could increase their profits.
The problem is that Russia may be tempted to sell naphtha at such low prices and thereby cut off its production. This will lead to an increase in world naphtha prices, which will eventually increase prices in India, as well as in Ukraine’s allies. Wanting a quick delivery of naphtha to Russia, Putin may be ready to take the plunge at any time, as high prices for nafta will increase Donald Trump's chances of winning the presidential election in the fall of leaves in the United States.
Ukraine's allies for now that they are not ready to make the necessary expenses in order to expand Russia’s income. Until the stink of anyone is raised, Putin has no financial reason to start fighting, says Reuters.
It seems that the price for Russian naphtha is equal to 60 dollars per barrel, according to the i 2022 fate, shortened the Kremlin's income by 14%. An analysis by the Center for Research on Clean Energy and Energy (CREA) shows that the remaining market price regime cost the Kremlin €34 billion in export revenues, equivalent to approximately two months of revenues.