Declining global oil prices have been weakening the currency, Deputy Chairman Aleksey Zabotkin says
The recent weakening of the Russian ruble could be attributed to the fall of global oil prices, according to Aleksey Zabotkin, Deputy Chairman of the Central Bank of Russia, cited by business daily RBK on Monday.
Volatility in the Russian foreign exchange market has increased sharply since the beginning of December, with the ruble falling to a more-than-eight-month low against the US dollar last week. The Russian currency, however, started recovering since Friday to begin this week at around 68.2 rubles to the dollar and 72.4 rubles against the euro. Trading data shows that, despite the decline, the ruble is still up for the year, trading 10% higher than it did in early January, prior to the start of Russia’s military operation in Ukraine and the ensuing Western sanctions.
“There is a deterioration in external conditions, a decline in oil prices. This is a weighty enough reason for the exchange rate to weaken somewhat,” Zabotkin explained. He pointed out, however, that the rate is still “fluctuating in the range that has been observed since about the end of May this year.”
According to the deputy chairman, the observed weakening of the ruble will contribute to a rise in prices. He noted that every 10% movement in the exchange rate generally adds about 0.5%-0.6% to inflation. “But at the same time, it should be mentioned that these 0.5%-0.6% are not realized instantly, but are stretched over time for six to twelve months,” he said.
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“The disinflationary contribution of the strengthening of the ruble, which occurred in the second half of spring and summer, has ultimately been exhausted by now,” Zabotkin added. The regulator does not plan to tighten any restrictions on the capital account, he stressed.
The weakening of the Russian currency by the end of 2022 has been predicted by many analysts in recent months. Some experts expect it to drop even further in the months to come.
The projections come as the price of benchmark Brent oil has fallen from almost $90 per barrel to about $84 since the beginning of December. The average price for Russian Urals oil, which, after the introduction of a series of sanctions, is sold at a discount, amounted to $57.49 per barrel in December, according to Ministry of Finance estimates. A month earlier, the price was $71.1 a barrel.
The $60-per-barrel ceiling on Russian seaborne crude, devised by the G7 and the EU, came into force on December 5. The measure, along with a ban on EU imports of seaborne Russian flows, is aimed at curbing the Kremlin’s revenues. Russian oil cargoes that are traded above the threshold cannot access some key services from Western companies, including insurance.
Every weeknight, Dan Rea is busy at work upstairs in his Chestnut Hill home.
Wearing a headset with a mic, Rea keeps an eye on his laptop to see who is calling into NightSide, a talk show the veteran Boston newsman hosts on WBZ NewsRadio 1030 AM from 8 p.m. to midnight Monday through Friday.
NightSide entered its 16th year on the airwaves in October, and Rea said he won’t be calling it quits anytime soon. He is having too much fun on what he calls “North America’s Virtual Back Porch,” as he connects with listeners from across the country and in Canada.
“You don’t have to be a U.S. senator or governor to be a caller to my show,” said Rea, a member of the Massachusetts Broadcasters Hall of Fame. “Your voice and your opinion is just as important to me as a governor or senator because you are a part of the fabric of our society. Those voices need to be heard.”
Rea adapted to his remote work environment at the onset of the COVID-19 pandemic in March 2020, more than a year-and-a-half after WBZ NewsRadio moved its headquarters from Soldiers Field Road in Allston to Medford in August 2018.
Working out of his Chestnut Hill home has caused Rea to lose the ability to have eye contact with his guests and read their body language, which made the transition to the remote world challenging.
Rea has overcome those early hurdles, evidenced by the number of listeners and guests that continue to call into NightSide on a nightly basis. Rea broadcasted the year’s final episode of NightSide on Thursday, when he hosted the show’s 10th annual charity combine by interviewing representatives from 22 charities across New England.
Though he has enjoyed interviewing some big-named politicians, such as former U.S. House Speaker Paul Ryan, on his show, Rea said he believes the charity combine is his most important episode of the year.
“I want to connect my audience with some of those charities so they could either contribute to them or volunteer for them,” he said of the purpose behind the charity combine. “Those people are important because of the amount of good they do, more so than a major politician or a famous person.”
Self-identified as an independent, Rea said the topics he discusses throughout his show dictates whether he stays neutral or takes a side. He made his opinion known during a segment earlier this month on the Dedham library director rescinding her initial plan not to put up Christmas trees in the town’s two libraries.
“It would be like me saying, ‘Tonight, I’m going to do a special show and we’re going to do the sounds of silence for an hour,’ ” Rea said. “(Listeners) would be like, ‘You’re a radio talk show host, you have to do a show.’ It just doesn’t make any sense.”
In other instances, Rea said he prefers to give more time to listeners and guests so he can gain a deeper understanding on the issues of the day. Rev. Kevin Peterson, founder of Boston-based New Democracy Coalition, appeared on the Dec. 15 episode to discuss the Boston City Council approving a committee to study reparations for Black Bostonians and what that means.
Rea’s approach to his shows is a shift from when he reported stories “right down the middle” during his 31-year-career as an on-air television reporter for WBZ-TV, the CBS affiliate in Boston.
Awards that Rea has received throughout his decorated career — including the Yankee Quill Award, considered the highest individual honor for journalists in New England — cover a wall near his studio on the top floor of his home.
“I watched this city grow over decades,” Rea said about working in the Boston news industry. “When people talk about the bad old days, hey, I lived in the bad old days. I went to Boston Latin School, Boston State College, Boston University Law School. I’m a Boston guy, very proud of the city but I can still be critical.”
Over the years, as technology and social media have evolved the journalistic landscape, Rea has become active on Twitter, Instagram and Facebook. Every day, either Rea or his producer post previews and recaps of that night’s show on Faceboo
Sometimes, depending on the magnitude of a particular issue, Rea said, stories could be covered “wall to wall,” such as the immediate aftermath of the bombing at the Boston Marathon in April 2013 and the search for terrorist Dhzokhar Tsarneav.
On other days, when the news cycle is slow, Rea said he has to get creative and “come up with a spin that would interest people.”
The WBZ NewsRadio signal reaches 38 states, allowing Rea to form relationships with listeners from across the country and in Canada, including Clark in Pennsylvania, Richard in Toronto, Chuck in Georgia, William in Baltimore and Susan in Chicago, all of whom are frequent callers, he said.
“Without callers, I don’t have a talk show,” Rea said. “I am not the show. The callers and guests are the show. They make the show work. If it’s just me for four hours, who’s going to listen to me for four hours? They may for a while but not for long.”
Dan Rea talks about memorable moments from his almost 50-year career in Boston TV and radio. (Amanda Sabga/Boston Herald)NightSide entered its 16th year on the airwaves in October, and Dan Rea said he won’t be calling it quits anytime soon. He is having too much fun on what he calls “North America’s Virtual Back Porch,” as he connects with listeners from across the country and in Canada. (Amanda Sabga/Boston Herald)
Deputy Prime Minister Novak says the Yamal-Europe Pipeline remains unused
Moscow is ready to restart supplies of natural gas to the EU via the Yamal-Europe Pipeline, Russian Deputy Prime Minister Aleksandr Novak said on Monday. He noted that shipments through the route were halted for political reasons.
According to the official, the EU remains a relevant market for Russia, which is able to resume supplies to a region suffering from a gas shortage.
“For example, the Yamal-Europe Pipeline, which was shut down for political reasons, remains unused,” Novak said.
Gas supplies via the pipeline, which usually flow westward, have been mostly reversed since Poland terminated a supply contract with Russia ahead of its end-2022 expiry date, after rejecting Moscow’s demand for ruble payments. The Polish leg of the route is currently being used to pump stored gas from Germany.
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In response to Warsaw’s move, Russian state-run energy giant Gazprom cut off supplies, saying it could no longer send gas via Poland, while Moscow imposed sanctions against the firm that owns the Polish section of the Yamal-Europe pipeline.
Although Russian gas deliveries to the EU via the Nord Stream and Yamal-Europe pipelines have been halted, Russian gas is still being supplied to certain European buyers via a transit line through Ukraine and the TurkStream pipeline through Türkiye.
Despite the persisting problems, Novak says he still sees the EU as a viable market for Russia.
“Today we can confidently say that there is a stable demand for our gas. Therefore, we continue to consider Europe as a potential market for our products. It is clear that a large-scale campaign was launched against us, which ended with acts of sabotage against the Nord Stream pipelines,” he said.
The market for liquefied natural gas (LNG) also remains open, according to Novak, who noted that Russian LNG supplies to the EU are expected to grow to 21 billion cubic meters by the end of the year.
Net outflows exceeded $26 billion this year, according to EPFR Global
UK stocks suffered record annual outflows in 2022 as investor confidence in the country’s economy is waning, Bloomberg reported on Friday, citing data from EPFR Global.
Statistics show that some $26.3 billion has been withdrawn so far, which coincides with a slump of 20% for the FTSE 250 Index. The benchmark index was down by the most since 2008. Meanwhile, the blue-chip FTSE 100 Index was up more than 1%, largely due to its exposure to commodity stocks that soared this year.
The record equity fund outflows marked the seventh year in a row that investors have been turning away from UK markets, according to Bloomberg.
“The country has been roiled by political and economic troubles this year,” the outlet wrote, specifying that “The onset of a recession, inflation at a 41-year high, two prime ministers resigning and the highest number of strikes since the 1980s helped trigger selloffs in domestic stocks and the pound.” All that has resulted in London losing its crown to Paris as Europe’s biggest stock market, the report said.
A senior strategist at State Street Global Markets, Marija Veitmane, told the media outlet she is less optimistic about UK stocks in 2023 as “we expect the market focus to switch from macro headwinds to microeconomics and earnings recession.”
“The UK is less likely to do well, as earnings and profitability of UK companies are not the strongest, which may lead to underperformance,” she added.
