Oil for 100 dollars, and gasoline for 100 rubles: a new reality at the door?
Making bad predictions, like telling the truth, is easy and pleasant. Almost no risk, and on occasion you can say: "I warned you."
The first part of the forecast made in the title, it would seem, for us Russians, is extremely positive. GDP will grow, money in the budget will again be abundant, although it is clear to everyone that they will again find out where it is not clear from whom.
From the replenishment of reserve funds to citizens, neither warm nor cold, and cyclopean infrastructure projects worth trillions of rubles will most likely be beneficial only to separately selected oligarchs and foreign builders. There is nothing to count on real compensation for pensions and, moreover, for the salaries of state employees.
But to run into the next wave of price increases can be easily. And above all for gasoline. After all, in Russia it has become so common that if oil falls in price, then gasoline will definitely go up. So that oilmen would not lose the incentive to fill gas stations in the country. If oil begins to go up, gasoline in Russia has nowhere to go at all. It is necessary to go up after the raw materials. And gasoline, of course, will pull all the other prices along.
Well, the fact that nothing of the kind happened this summer and in September, even though we “warned”, only a political factor seems to be to blame. More precisely, the single voting day, when in the outback not only several governors were rolled out at once, but also some regional parliaments fairly shocked. However, the people, apparently, in this way also decided to respond to the forthcoming pension reform with their votes. And no tricks by the executive to curb gasoline prices have played any role in pacifying the electorate.
No, and now there is no serious threat of rising fuel prices. But, obviously, only because there is no serious demand. More precisely, according to Rosstat, it does not grow at all, in spite of the traditional September business growth and harvesting campaign. Of course, to some extent today the fact that in the summer of oil giants under the control of the antimonopoly service literally had to create serious fuel reserves still affects the prices. But it's hard to say for how long this reserve will last.
However, let us return to the positive. World oil prices at the start of this week rushed up. At the moment, the last growth decisions of exporting countries, which very consistently implement the notorious OPEC + deal, have become the decisive growth factor for them. In Russia, experts have already rushed for some reason to voice a very strange assessment of how it comes to life - as much as 129 percent. Interestingly, in the Vienna headquarters of OPEC constantly insist that they strive only for its absolute execution.
The OPEC + Ministerial Committee on Monitoring the Transaction, which met on Sunday in Algeria, also decided only to "continue to strive for the 100% level of compliance with the conditions of the Vienna Agreement." At the same time, the ministers noted that specific figures are not so important, the main thing is to preserve the achieved market balance.
In the meantime, the cost of December futures for North Sea Brent crude oil mix rose by 0,2%, breaking an important price mark in 80 dollars per barrel. Intermediate trading quotes on Tuesday reached 80,69 dollar. At the same time, the price of the November futures for oil of the cheaper WTI brand reached 72,17 dollars per barrel, with an increase of 0,12%.
Oil traders rarely make mistakes, but when big politics get involved, they are powerless. Therefore, many experts are apprehensively assessing a series of recent announcements and notes on twitter that the American President Trump made in recent days.
Aggressive rhetoric and the threat of new sanctions against Iran in the event of the actual implementation of these plans, can simply blow up the oil market. But, judging by the calm that traders demonstrate, from Trump's words to the matter - the distance is, if not huge, then very large.
Perhaps, taking into account this “distance”, Khalid Al-Falih, the Minister of Energy of Saudi Arabia, the informal leader of OPEC, made his predictions for 2019. After the meeting in Algeria, he stated that OPEC + is not expecting a deficit, but an excess of supply on the world oil market in 2019 and allows for a return to a reduction in its production. There was no question of a possible increase in production, which was quite confidently predicted as early as August.
Recall that OPEC and a number of non-member countries, including Russia (why the agreement was called OPEC +), agreed at the end of 2016 of the year in Vienna to reduce oil production by 1,8 million barrels per day. The countdown was then decided to keep on the level of October 2016. 300 thousand barrels of these 1,8 million went to Russia.
The contract began in January 2017, it was then extended for the entire 2018 year. Due to the fact that many countries, and Russia among them, even exceeded their obligations under the agreement, there was talk of increasing production levels. But it seems that this is so limited to talk.
Apparently, traders added “already” to the words of the Saudi minister, and against such a background, Brent crude went up on Monday by more than 3%. On Tuesday, as we see, growth has slowed. Meanwhile, Russia, which very scrupulously fulfills its part of the OPEC + agreement, once again plunges into discussions about what to do with domestic prices for refined products in such conditions, first of all, it is clear - for gasoline.
The Communist faction in the State Duma has long ago introduced a bill introducing state regulation of gasoline and diesel fuel prices from 2019 of the year. The arguments of the CPSU heirs look quite convincing: the internal prices for fuel should not depend on external conditions, and their current growth, like the possible future one, is associated only with a change in the taxation system. That is, with the notorious tax maneuver, which transfers the entire tax burden directly to the wells.
Once such an approach seemed to the Communists, and not only them, the only true in relation to the raw materials industries. Now, experience has shown that by itself, the mineral extraction tax cannot be saved from price increases. At the same time, opponents of the communists remind that the tax maneuver has already made the export of oil and oil products truly profitable, and the domestic market can be filled with quota-based government procurement.
However, supporters of Mr. Zyuganov expressed very reasonable concerns that already at the beginning of 2019, the cheapest 92 gasoline would rise in price from the current 40 with a little to 50 rubles per liter. Why? Yes, because there is no compensation for deliveries to the domestic market in gasoline excise taxes, and no whip, from the Ministry of Energy or from the antimonopoly service, you will not drive oilmen to it. As a result, the oil giants can, even without saying a word, arrange such a shortage of fuel within the country, that a rise in gasoline prices will be the only way to salvation.
It is characteristic that the discussion about the notorious tax maneuver resumed on a rather strange background. It is about allowing companies that have fallen under sanctions not to repatriate foreign exchange earnings made back in July. It has now actually been prolonged until the end of the year, not really advertising such a decision, but placing a straw in the form of a link to the next portion of sanctions, which threatens Russia in November.
How, in such conditions, to fight for at least relatively cheap gasoline is a question that our liberal economists do not know the exact answer to the authorities. And it seems that they also do not know the answer to the question of how to now fight for a strong ruble, which is still heavily dependent on oil prices, and a little less strongly on the price of gasoline in the country.
But, apparently, they seriously and do not intend to fight. Concerning the ruble, presidential adviser Sergey Glazyev spoke very harshly about what Topwar.ru wrote (see here). A little earlier, though not so concretely, the well-known economist Konstantin Korishchenko walked through the current monetary policy of the Central Bank and the Ministry of Finance. Once he was closely involved in the stock market at the Bank of Russia and on the RTS Stock Exchange, and now he is engaged exclusively in science, being the head of the department of stock markets of the RANEPA.
So, according to him, now in Russia and “exporters are for a weak ruble, and the budget is for a weak ruble. At the same time, the Central Bank is for stable reserves, and banks are flow-traders (conservative traders who trade, as a rule, large volumes), they do not have a clear position on the weakness or strength of the ruble, they just play on the ruble movement. ” Only the population of Russia - and even then not 100 percent - is now interested in a strong ruble. It turns out that “if no one deliberately does anything, the ruble will most likely have to weaken,” the expert noted.
Alas, that's exactly what happened: lately, only on rumors and fears because of the sanctions, the ruble has lost up to 18 percent at the rate of both the dollar and the euro. And although now he plays back something, he is unlikely to return to the old equilibrium quotes.
The first part of the forecast made in the title, it would seem, for us Russians, is extremely positive. GDP will grow, money in the budget will again be abundant, although it is clear to everyone that they will again find out where it is not clear from whom.
From the replenishment of reserve funds to citizens, neither warm nor cold, and cyclopean infrastructure projects worth trillions of rubles will most likely be beneficial only to separately selected oligarchs and foreign builders. There is nothing to count on real compensation for pensions and, moreover, for the salaries of state employees.
But to run into the next wave of price increases can be easily. And above all for gasoline. After all, in Russia it has become so common that if oil falls in price, then gasoline will definitely go up. So that oilmen would not lose the incentive to fill gas stations in the country. If oil begins to go up, gasoline in Russia has nowhere to go at all. It is necessary to go up after the raw materials. And gasoline, of course, will pull all the other prices along.
Well, the fact that nothing of the kind happened this summer and in September, even though we “warned”, only a political factor seems to be to blame. More precisely, the single voting day, when in the outback not only several governors were rolled out at once, but also some regional parliaments fairly shocked. However, the people, apparently, in this way also decided to respond to the forthcoming pension reform with their votes. And no tricks by the executive to curb gasoline prices have played any role in pacifying the electorate.
No, and now there is no serious threat of rising fuel prices. But, obviously, only because there is no serious demand. More precisely, according to Rosstat, it does not grow at all, in spite of the traditional September business growth and harvesting campaign. Of course, to some extent today the fact that in the summer of oil giants under the control of the antimonopoly service literally had to create serious fuel reserves still affects the prices. But it's hard to say for how long this reserve will last.
However, let us return to the positive. World oil prices at the start of this week rushed up. At the moment, the last growth decisions of exporting countries, which very consistently implement the notorious OPEC + deal, have become the decisive growth factor for them. In Russia, experts have already rushed for some reason to voice a very strange assessment of how it comes to life - as much as 129 percent. Interestingly, in the Vienna headquarters of OPEC constantly insist that they strive only for its absolute execution.
The OPEC + Ministerial Committee on Monitoring the Transaction, which met on Sunday in Algeria, also decided only to "continue to strive for the 100% level of compliance with the conditions of the Vienna Agreement." At the same time, the ministers noted that specific figures are not so important, the main thing is to preserve the achieved market balance.
In the meantime, the cost of December futures for North Sea Brent crude oil mix rose by 0,2%, breaking an important price mark in 80 dollars per barrel. Intermediate trading quotes on Tuesday reached 80,69 dollar. At the same time, the price of the November futures for oil of the cheaper WTI brand reached 72,17 dollars per barrel, with an increase of 0,12%.
Oil traders rarely make mistakes, but when big politics get involved, they are powerless. Therefore, many experts are apprehensively assessing a series of recent announcements and notes on twitter that the American President Trump made in recent days.
Aggressive rhetoric and the threat of new sanctions against Iran in the event of the actual implementation of these plans, can simply blow up the oil market. But, judging by the calm that traders demonstrate, from Trump's words to the matter - the distance is, if not huge, then very large.
Perhaps, taking into account this “distance”, Khalid Al-Falih, the Minister of Energy of Saudi Arabia, the informal leader of OPEC, made his predictions for 2019. After the meeting in Algeria, he stated that OPEC + is not expecting a deficit, but an excess of supply on the world oil market in 2019 and allows for a return to a reduction in its production. There was no question of a possible increase in production, which was quite confidently predicted as early as August.
Recall that OPEC and a number of non-member countries, including Russia (why the agreement was called OPEC +), agreed at the end of 2016 of the year in Vienna to reduce oil production by 1,8 million barrels per day. The countdown was then decided to keep on the level of October 2016. 300 thousand barrels of these 1,8 million went to Russia.
The contract began in January 2017, it was then extended for the entire 2018 year. Due to the fact that many countries, and Russia among them, even exceeded their obligations under the agreement, there was talk of increasing production levels. But it seems that this is so limited to talk.
Apparently, traders added “already” to the words of the Saudi minister, and against such a background, Brent crude went up on Monday by more than 3%. On Tuesday, as we see, growth has slowed. Meanwhile, Russia, which very scrupulously fulfills its part of the OPEC + agreement, once again plunges into discussions about what to do with domestic prices for refined products in such conditions, first of all, it is clear - for gasoline.
The Communist faction in the State Duma has long ago introduced a bill introducing state regulation of gasoline and diesel fuel prices from 2019 of the year. The arguments of the CPSU heirs look quite convincing: the internal prices for fuel should not depend on external conditions, and their current growth, like the possible future one, is associated only with a change in the taxation system. That is, with the notorious tax maneuver, which transfers the entire tax burden directly to the wells.
Once such an approach seemed to the Communists, and not only them, the only true in relation to the raw materials industries. Now, experience has shown that by itself, the mineral extraction tax cannot be saved from price increases. At the same time, opponents of the communists remind that the tax maneuver has already made the export of oil and oil products truly profitable, and the domestic market can be filled with quota-based government procurement.
However, supporters of Mr. Zyuganov expressed very reasonable concerns that already at the beginning of 2019, the cheapest 92 gasoline would rise in price from the current 40 with a little to 50 rubles per liter. Why? Yes, because there is no compensation for deliveries to the domestic market in gasoline excise taxes, and no whip, from the Ministry of Energy or from the antimonopoly service, you will not drive oilmen to it. As a result, the oil giants can, even without saying a word, arrange such a shortage of fuel within the country, that a rise in gasoline prices will be the only way to salvation.
It is characteristic that the discussion about the notorious tax maneuver resumed on a rather strange background. It is about allowing companies that have fallen under sanctions not to repatriate foreign exchange earnings made back in July. It has now actually been prolonged until the end of the year, not really advertising such a decision, but placing a straw in the form of a link to the next portion of sanctions, which threatens Russia in November.
How, in such conditions, to fight for at least relatively cheap gasoline is a question that our liberal economists do not know the exact answer to the authorities. And it seems that they also do not know the answer to the question of how to now fight for a strong ruble, which is still heavily dependent on oil prices, and a little less strongly on the price of gasoline in the country.
But, apparently, they seriously and do not intend to fight. Concerning the ruble, presidential adviser Sergey Glazyev spoke very harshly about what Topwar.ru wrote (see here). A little earlier, though not so concretely, the well-known economist Konstantin Korishchenko walked through the current monetary policy of the Central Bank and the Ministry of Finance. Once he was closely involved in the stock market at the Bank of Russia and on the RTS Stock Exchange, and now he is engaged exclusively in science, being the head of the department of stock markets of the RANEPA.
So, according to him, now in Russia and “exporters are for a weak ruble, and the budget is for a weak ruble. At the same time, the Central Bank is for stable reserves, and banks are flow-traders (conservative traders who trade, as a rule, large volumes), they do not have a clear position on the weakness or strength of the ruble, they just play on the ruble movement. ” Only the population of Russia - and even then not 100 percent - is now interested in a strong ruble. It turns out that “if no one deliberately does anything, the ruble will most likely have to weaken,” the expert noted.
Alas, that's exactly what happened: lately, only on rumors and fears because of the sanctions, the ruble has lost up to 18 percent at the rate of both the dollar and the euro. And although now he plays back something, he is unlikely to return to the old equilibrium quotes.
Information