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Ruble Slips as Crude Oil’s Decline Outweighs Manufacturing Gains

The ruble retreated after its first monthly gain since April as declining prices for crude oil offset a surprise improvement in Russian manufacturing data. The Russian currency strengthened 0.2 percent before erasing the advance to trade 0.2 percent weaker at 64.05 as of 6:35 p.m. in Moscow. Brent crude sank as much as 1.9 percent. Government five-year bonds climbed, lowering the yield one basis point to 10.13 percent. Russia’s central bank kept interest rates on hold at its meeting last week as policy makers struggle to balance between pulling the economy out of recession and controlling inflation that hovers near a 13-year high. The expansion of the Russia Manufacturing Business Activity index to 50.2 in October, the highest since November last year, gives grounds for cautious optimism, according to Danske Bank A/S strategist Vladimir Miklashevsky, who recommends buying February 2027 bonds for the long-term. “This is the first good […]

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Russian Crude Output Hits Post-Soviet Record Defying Price Slump

An oil drilling tower near Almetyevsk, Russia. Russian oil production broke a post-Soviet record in October for the fourth time this year as earlier investments boosted output and producers prove resilient to lower crude prices. Production of crude and gas condensate, which is similar to a light oil, averaged 10.776 million barrels a day during the month, according to data from the Energy Ministry’s CDU-TEK unit. That is an increase of 1.3 percent from a year earlier and up 0.3 percent from the previous month. “Russian oil production is still reflecting oil prices above $100 a barrel due to long lead times in the investment cycle,” Alexander Nazarov, an oil and gas analyst at Gazprombank JSC, said by e-mail from Moscow. “The reason behind growth this year dates back to 2010-2014, when a number of projects were financed.” Output has kept growing even as the Organization of Petroleum Exporting […]

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Russia Oil Production Poised for Record as Industry Defies Slump

Russian oil output is poised to break a post-Soviet record for the fourth time this year as the nation’s producers once again prove themselves resilient to a slump in crude prices. Production of crude and a light oil called condensate is on track to reach 10.77 million barrels a day in October, topping the previous month’s revised figure and setting a record for the second month running, according to Bloomberg estimates based on Energy Ministry data. Russian production has withstood a collapse in oil prices amid a global supply glut, while output in the U.S. has fallen about 5 percent from its June peak. Oil-extraction and export tax rates shrink in Russia at lower prices, giving companies a buffer against the slump, while the weaker ruble has reduced costs . “Russian oil companies are insulated from oil price corrections,” said Artem Konchin, an oil and gas analyst at Otkritie […]

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Russian Bonds Decline as Ruble Swings Reduce Case for Rate Cuts

Russian bonds fell, sending yields higher for a second day, after a drop in the ruble this week raised the prospect that the Bank of Russia will struggle to justify resuming interest-rate cuts to support the economy. Yields on the government’s local-currency bonds climbed three basis points to 10.16 percent by 11:52 a.m. in Moscow. The ruble was little changed after slumping 3.9 percent in the previous two days. Forward-rate agreements showed wagers for interest rates to fall by 55 basis points in three months, down from 70 basis points at the end of last week. The ruble’s depreciation this week, which happened as oil fell and currency demand from exporters to pay taxes waned, may make it harder for Bank of Russia policy makers to justify restarting interest-rate cuts when they meet on Friday. Economists surveyed by Bloomberg are evenly split on their outlook for the decision, with […]

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Iran Proposes to Swap Oil, Gas With Russia

Iran has proposed to swap oil and gas with Russia , Press TV quoted oil minister Bijan Zangeneh as saying. Zangeneh said the proposal was raised during a meeting on Wednesday with the visiting Russian energy minister Alexander Novak. According to the proposal, Iran would receive natural gas, oil and oil products from Russia through its northern terminals and will sell equivalent volumes of the same products to Russia’s clients through its southern terminals, Press TV reported. Zangeneh suggested that Iran and Russia have adequate facilities to proceed with this swap mechanism. Tehran has been using a similar mechanism with Turkmenistan, Kazakhstan and Azerbaijan for over a decade through which it would receive oil from the three Caspian states at its Neka terminal and would deliver equal amounts with similar specifications to their clients at its southern ports.

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Gazprom Said to See Its Lowest Europe Gas Price in 11 Years

Gazprom PJSC, the world’s biggest natural gas exporter, is planning for the lowest price for its fuel in its main European market for more than a decade. The state-run exporter is drafting its budget for 2016 with preliminary estimates for gas prices outside the former Soviet Union of about $200 per 1,000 cubic meters ($5.45 a million British thermal units), said two people with direct knowledge of the matter who asked not to be identified because the information is private. That compares with the company’s estimate of an average price for the region, which covers Turkey and Europe outside the Baltic States, in 2015 of about $238 per 1,000 cubic meters and $349 last year. The company’s press office declined to comment on estimates. Gazprom, which supplies about a third of Europe’s gas and relies on exports of the fuel for 40 percent of its annual revenue of more […]

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Russian gas giant: Expansion of pipeline ensures reliability

Russian energy company Gazprom says expanding its Nord Stream pipeline network will help ensure Europe has a reliable source of energy. Photo courtesy of Gazprom PARIS, Oct. 23 (UPI) — Russian natural gas company Gazprom said expanding the Nord Stream pipeline to Europe adds another layer of security to the region’s energy sector. Russia meets about a quarter of European gas needs, though the bulk of that gas runs through a Soviet-era pipeline network in Ukraine. Conflict and ongoing debt issues between Gazprom and Kiev have created risks to the conventional artery, at times leaving downstream European consumers without gas needed for heat. Concealed Carry Mistakes: concealedcarryconfidence.org The Worst Thing a Permit Holder Can Do & More Concealed Carry Tips: Gazprom Chairman Alexei Miller met with French officials to discuss progress on expanding the Nord Stream gas pipeline, which runs through the Baltic Sea to Germany. Russia supplied France […]

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CEO of Russia’s Rosneft Criticizes Saudi Oil-Market Strategy

Saudi Arabia’s move to maintain its share of the global oil market and expand in Europe will backfire, said the chief executive officer of Russia’s largest oil producer. “The strategy that Saudi Arabia has chosen doesn’t bring any significant victories,” Igor Sechin, CEO of OAO Rosneft, said Thursday at the Eurasian Forum in Verona, Italy. “More likely the opposite.” After the U.S. cut imports amid a boom in domestic production, exporters from the Middle East are increasing output and seeking new markets, a move that isn’t helpful for the global industry, Sechin said. After oil prices slumped amid a global surplus, Middle Eastern governments have to use “billions of dollars” from sovereign funds, raise large external loans or cut spending on new cars and furniture to make up the shortfall in revenues, he said. Saudi Arabia led the Organization of Petroleum Exporting Countries in a decision last year to […]

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Assad Finds Chilly Embrace in Moscow Trip

Photo The rebel-held area of Douma, east of Damascus, on Wednesday after an airstrike by Syrian forces was reported. Credit Sameer Al-Doumy/Agence France-Presse — Getty Images WASHINGTON — In the winter of 2012, when the civil war in Syria had already consumed tens of thousands of lives, Vladimir V. Putin , the Russian president, sounded dismissive of Syria’s beleaguered leader, Bashar al-Assad , and unconcerned about his future. Mr. Assad, he said, acidly, had spent more time courting leaders in European capitals than he ever had in Moscow. “We are not that preoccupied with the fate of Assad’s regime,” Mr. Putin said then. Three years later, the two presidents have bound themselves together in an alliance that reflects not only the urgent priority of salvaging the crumbling central government in Syria, but also each man’s eroded standing on the international stage. Mr. Putin’s military has forcefully intervened to shore […]

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Russian minister sees oil prices stuck at $50 “for years”

Russia’s economy minister warned that the nation is facing years of oil prices at about $50 as a sluggish global economy ushers in a long cycle of low commodities prices. The world’s largest energy exporter must continue financial support for non-commodities exports to buoy the nation’s shrinking economy, Alexei Ulyukayev told a conference Wednesday in Moscow. Measures to help growth by encouraging local food production are starting to pay off, according to First Deputy Prime Minister Igor Shuvalov. “We have entered a period of low prices for commodities, a long commodities cycle that’s ongoing and that will continue for a number of years,” Ulyukayev said. “I don’t see any sharp slumps but, relatively speaking, the oil price will be $50, $50 plus for years. Faced with the oil-price weakness and sanctions over the crisis in Ukraine, Russian officials are searching for ways to steer the country out of its […]

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