Deutsche Bank expects the exhaustion of NWF in two years when the price of Urals of $15.
Liquid resources of the national welfare Fund (NWF) of Russia can be exhausted in two years, if all this time the price of Russian Urals oil will remain at $15 per barrel, the report says Deutsche Bank (there is a “b”). The Ministry of Finance said that FNB will be able within six to ten years to cover budget losses from the fall in oil prices to $25-30. On 22 April, the price of Urals fell to the 1999 level, reaching $at 11.59.
According to estimates of Deutsche Bank, in March the liquid part of the NWF totaled $150 billion. This amount should be reduced to about $120 billion after the purchase of the government shares of Sberbank from the Central Bank, experts say. “With the price of Urals of $15 of this amount would be enough to cover the deficit of revenues from oil for a little over two years, but this term would be tripled (to six years.— “B”), if the price of Urals was at $30,” said Deutsche Bank.
Experts believe that, in General, Russia has enough “fiscal buffers” to cope with “temporary shock” of falling oil prices. But, as noted in the Deutsche Bank, in conjunction with the economic damage from the fiscal space coronavirus (reserve government budget, which can be used without compromising the stability of the economy) will be greatly limited, especially in the case of a slow recovery in oil prices.
In April, Finance Minister Anton Siluanov said that by the end of 2020 FNB will be reduced to 7 trillion rubles, but the Fund’s resources will be sufficient until 2024 at current oil prices. The head of Sberbank German Gref believes that the NWF will last for several years without compromising the budget.