Analysts predict that Russia is about to see its largest profits from selling oil and gas in the history of the country, even as the Russian ruble continues to regain value despite U.S. sanctions.
An analyst with the German Science and Politics Foundation predicts that “will see the highest gas profits in history for 2022 despite sanctions from the U.S. and Western powers,” according to Big League Politics.
Translated from German, analyst Janis Kluge predicts that ““The gas price on the spot markets has quintupled within the past year. That means Gazprom,” a Russian majority state-owned energy company, “will have record revenues” despite the sanctions, which Kluge says may be backfiring.
“Russia planned the national budget with a dollar-ruble exchange rate of 72, but now the ruble is around 85, much weaker, but with a view to energy exports this is an advantage.” Kluge explained, “If we multiply the oil price by the ruble exchange rate, it shows that Moscow expected revenues of around 4,500 rubles per barrel of oil, but is getting much more, around 7,000 rubles.”
Several countries have tightened trade relations with Russia despite U.S. sanctions, with China calling them increasingly “outrageous” and discussing increasing their imports from Russia, and India announcing an alternative payment system that would see Russian goods bought in rupees and Indian goods bought in rubles.
The ruble also appears to be on the road to recovery as Russia increasingly looks toward China and other Asian countries after being cut off from its historic trade with Western Europe.
In the United States, pundits expressed dismay when the Russian ruble recovered near to its pre-war value, though some experts believe the effects of sanctions will simply take longer to materialize.
“This is an ongoing process,” a Heritage Foundation representative told Fox Business. “For now, as markets are processing more and more information, and we see the conflict is getting prolonged rather than getting really intense and more negative.”
Russia invaded Ukraine in February after a years long standoff over the disputed Donbass region in Eastern Ukraine. Moscow claims it launched a “special military operation” to protect ethnic Russians from Ukrainian state violence, while Kiev and much of the international community maintain that the invasion was unprovoked.
