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UPDATE 1-Russia cbank says sees oil average at $35/barrel in 2016
February 12, 2016 / 2:59 PM / in 2 years

UPDATE 1-Russia cbank says sees oil average at $35/barrel in 2016

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MOSCOW, Feb 12 (Reuters) - The Russian central bank lowered its average oil price forecast for this year to $35 per barrel from earlier $50 per barrel, the bank’s first deputy governor, Dmitry Tulin, said on Friday.

This means that the price the central bank considered only in its “risk scenario” in December is now becoming the base case scenario for this year.

The central bank prepares different economic development scenarios that later help it guide monetary policy, with the base case scenario the most probable.

The base case scenario envisages oil prices at $45 per barrel on average in 2017-2018, while the risk case scenario puts them at $35, the bank’s first deputy governor, Dmitry Tulin, said on Friday.

So far this year, prices for Brent crude oil, a global benchmark for Russia’s main export, have not crossed $39 per barrel, staying largely below $35. On Friday, Brent traded at around $31.50.

“The degree of uncertainty is high,” Tulin told journalists. “We’re aware that such volatility and unpredictability in world oil price dynamics creates uncertainty for us on how probable it would be to achieve our inflation targets within a specific time frame.”

But, he added, the central bank for now is not giving up on its goals. Chief among them is bringing inflation down to 4 percent by 2017.

Annual consumer price inflation in January was at 9.8 percent.

The central bank is due to present its full forecasts with all envisaged scenarios after its next rate decision meeting on March 18. The bank’s analysts published their forecasts last week, pencilling in an average of $35 per barrel in the base case scenario. (Reporting by Elena Fabrichnaya; Writing by Christian Lowe and Lidia Kelly, editing by Jason Bush)

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