USATODAY: …The price of Brent crude oil, a global benchmark, hit a four-year low last week, plunging to below $83 per barrel from $116 in June. While it was just under $85 on Wednesday, there is considerable risk it could dip well below $80, costing Russia, whose budget gets half its revenue from oil and gas exports, billions of dollars, analysts said. Geopolitics and oil prices have already reduced Russia’s budget by an amount equal to 4% of its gross domestic product.
The troubles in Russia — the world’s eighth-largest economy — could have global repercussions. Deterioration of Russia’s credit could affect the health of some European banks along with economies in Europe and Central Asia that rely on trade with Russia. Economic instability would be particularly risky for Russia itself, where President Vladimir Putin’s rule at home owes much to the stability that’s come from high oil prices and relative prosperity for the population.
Moody’s downgraded Russia’s sovereign debt from Baa1 to Baa2, the second-lowest investment-grade rating, on Oct. 17, adding further pressure on the ruble, potentially raising Russia’s borrowing costs… (more)
