Oil, a major risk factor for the Russian ruble

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The Russian currency continued to fall in the beginning of the new week, although the recent bidding retreated from almost 1.5-month lows, thanks to the rebound in oil prices. In Asia, prices on the black gold hits 2-month highs, where she met buyers and has entered the area of growth.
The volatility of the ruble increased against the background of concern about the health of emerging markets, which worsened after another act of tightening policy of the fed, and amid upcoming elections in several countries of this segment. High demand for the dollar is also eroding the attractiveness of emerging markets currencies, including the ruble.
However, the main source of uncertainty and volatility for our currency in the next few days will be the behavior of prices in the oil market, which are preoccupied with the anticipation of the upcoming OPEC summit+ at the end of this week. From the verdict of the cartel and its allies will depend more long-term attitude on commodity platforms, and while the atmosphere here is imbued with uncertainty due to conflicting signals from the exporters involved in the transaction.
Informed buyers spooked transparent hints Saudi Arabia and Russia on the need at the beginning of the gradual increase in production.
This provoked a wave of sales, sending prices toward 2-month highs. Today appeared on the market rumors that the producers can increase production of 300-500 thousand barrels per day, which brought prices the relief as previously, the market has been more impressive figures.
Anyway, in the near future the oil market will remain extremely sensitive to any declarations of exporters and, therefore, the probability is quite sharp fluctuations of quotations, which in turn will affect the behavior of the ruble. The most cautious players can exit the market and wait for the decision of OPEC+.
Roman Blinov,
The head of the analytical Department of the company,
“International financial center”