Russia: The ruble falls by more than 18% in 2023!

The Russian ruble is plummeting in the first half of 2023 as the country continues its invasion of Ukraine. However, the price might not always stay that low. According to economic analyst Robin Brooks, the currency could reach new highs if action is not taken.

Russian ruble falls after outsized performance

The Russian ruble, the currency of Russia caused a sensation last year by becoming one of the best performers on the market. However, after the winter, the data is no longer the same. Currently, one US dollar is equal to 90 rubles, while at the beginning of the year 73 rubles bought a dollar.

This equates to an $18 drop. However, if this fall can raise questions, the economist Robin Brooks affirms that the currency has stabilized and could soon rise again. A former chief forex strategist at Goldman Sach and chief economist at the Institute of International Finance (IIF), Brooks believes rising oil prices should support the Russian ruble in the coming months.

In a July 22 tweet, the latter urged G7 countries to lower the oil price cap from $60 to $50 a barrel. According to him, this decision would oblige Russia to respect the sanctions which weigh on it.

Russians rely on oil to defy sanctions

Since Russia’s invasion of Ukraine, the country has been under sanctions from Western countries such as the United States. These restrictive measures are intended to put an end to the attacks, but the Russians seem to have found a way around: oil.

According to statements by Robin Brooks, Putin is defying sanctions because oil brings him enough money to keep buying things. Thus, the price ceiling would have to be reduced if the ruble’s fall is to continue.

Despite all these calls, the G7 countries remain silent. According to a report of the Wall Street Journal, the growing demand for Urals, Russian oil, is one of the factors driving up prices. Put like that, the ruble’s fall could soon be history, even if Western officials say the price cap is still working.