The liquid assets of the National Welfare Fund, used by the Russian government to compensate for the budgetary revenue deficit from oil and gas, could be completely exhausted in just over a year if the current oil prices are maintained, forecast the experts of the Economic Forecasting Center of Gazprombank, the third largest state bank in Russia by asset size.
At the beginning of the year, the National Welfare Fund still had 4.1 trillion rubles (approximately 45 billion euros) in the form of unspent funds – currency and gold in the accounts of the Central Bank. The rate of consumption of reserves depends on the duration and magnitude of the fall in oil prices, remind the center’s experts: currently, the fund begins to be used when the price of a barrel falls below the threshold of 59 dollars.
Under conditions of an oil price of about 40 dollars per barrel, the remaining reserves in the National Welfare Fund could be exhausted in just over a year, according to Gazprombank experts’ estimates. However, if the quotes drop to 30-35 dollars, the fund risks reaching zero by the end of this year. In a scenario of a price of 50 dollars per barrel, the reserves would last for about two and a half years.
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