Oil price will keep the ruble from falling at the opening of trading

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Tuesday, may 8, at the end of the trading session on the Moscow exchange rate of the us dollar calculations “tomorrow” increased by 29 kopecks (+0,46%), to 63,22 Euro fell 1 COP (-0,01%), to 75.00 RUB Trading volume in the pair dollar/ruble amounted to $3.2 billion (+23,07%), and Euro/ruble – KZT 235.7 million euros (-7,09%).
The Central Bank of Russia since may 9, has set the official exchange rate of the US dollar against the ruble at the level of 63,0066 RUB that above the previous day 29,18 COP. Official Euro to ruble exchange rate was set at around RUB 75,0409 compared with the previous value, the rate is higher by 29.18 COP.
Tuesday trading on the Moscow stock exchange opened with the fall of the ruble. On the background of the General strengthening of the greenback and the decline in oil prices, the dollar rose to 63.68 Euro – 75,51 to RUB.
Before the announcement of the President of the USA Donald trump decision on the Iranian agreement, the price of Brent crude has fallen by 4%. When he announced the U.S. withdrawal from the nuclear deal on Iran, it recovered to $76,15 per barrel. The growing oil prices, the ruble partially won back losses of the us currency, the dollar reached 63,53 rubles, and the ruble also completely erased losses from the Euro.
States believe that Iran after signing the agreement continued to Refine its nuclear and missile programs. The International atomic energy Agency has repeatedly confirmed that Iran complies with the terms of the agreement.
The oil market is under the impact of the decision by the White house on Iran. Trump ordered to immediately begin the process of restoring sanctions. As noted by the American leader, Iran will have to negotiate a new nuclear agreement.
According to the latest US Department of energy, the week before may 4, crude oil inventories fell by 1.85 mn barrels, gasoline stocks – on 2,055 million barrels, distillate stocks – at 6,674 million barrels. Oil production increased by 84 thousand to 10,703 barrels per day.
Yesterday, may 9, the rally in oil continued. Including today’s trading in Asia, the price of Brent crude oil exceeded $77. The ruble cost of a barrel is 4912 RUB, which is good for the Russian budget.
Wednesday, may 9, trading on the ruble was not conducted on the occasion of the national holiday – Victory Day. The market will react to yesterday’s price increase of oil. Brent crude oil rose to $77,71. I believe that the test level 63 rubles per U.S. dollar inevitable.
The momentum of the dollar in the first three hours of trading above 63 RUB show us that the ruble rid of oil will remain under pressure from the anti-Russian sanctions and the strengthening of the dollar. In this case it is possible to consider the recovery of the dollar to RUB 64,20 to the end of the week. Pair of Euro/ruble will keep the sideways movement in the price range 74,50-75,60 RUB.
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Vladislav Antonov,
Analyst
Alpari