Russia sanctions: Russia is doing better than expected despite sanctions: IMF

Despite the devastating Western sanctions imposed on Moscow in the wake of its invasion UkraineAnd the RussiaIts economy appears to be weathering the storm better than expected as it benefits from higher energy prices International Monetary Fund Tuesday said.

The aim of the sanctions was to disconnect Russia from the global financial system and to stifle the funds available to Moscow to fund the war.

But the International Monetary Fund’s latest World Economic Outlook report raised Russia’s GDP estimate for this year by a notable 2.5 percentage points, even though its economy is still expected to contract by six percent.

While major economies including the United States and China are slowing, the report said, “It is estimated that the Russian economy contracted during the second quarter less than previously expected, with crude and non-oil exports remaining better than expected.”

After starting the year below $80 a barrel, oil prices jumped to nearly $129 in March, before easing back to just over $105, while natural gas prices are rising again and approaching their recent peak.

Meanwhile, despite the sanctions, “Russia’s domestic demand is showing some resilience thanks to containing the impact of sanctions.”

In contrast, Europe faces the brunt of the fallout given its size

Regarding Russia for energy, the situation could worsen dramatically if Moscow cuts gas exports, and once the European Union imposes a ban on Russian oil deliveries by sea starting next year.

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