Account surplus reaches record in Russia despite sanctions
2023.01.17 09:30
Account surplus reaches record in Russia despite sanctions
By Ray Johnson
Budrigannews.com – The Russian central bank reported on Tuesday that Russia’s current account surplus reached a record high in 2022 due to a decline in imports and robust oil and gas exports that kept foreign money flowing in despite Western efforts to isolate the Russian economy.
A measure of the difference between all money flowing into a country through trade, investment, and transfers and what flows out, Russia’s current account was $227.4 billion in 2018, an 86% increase from 2021.
After the West imposed severe sanctions on Moscow for its invasion of Ukraine, Russian imports experienced a sharp decline the previous year due to an exodus of Western businesses.
However, the Kremlin has turned its attention to China, India, and other Asian nations in an effort to make up for the revenue it has lost from its oil and gas exports to Europe.
Chinese customs data showed that trade between China and Russia reached a record high of $190 billion last year.
Moscow’s trade balance, or the difference between total exports and imports, increased from $170.1 billion the year before to $282.3 billion in 2022 as imports decreased.
According to the central bank, higher commodity prices throughout 2022 contributed to the expansion of the current account, while imports gradually recovered in the second half of the year.
With the full implementation of Western and Japanese sanctions against Russian oil in 2023, Russia’s export revenues are anticipated to come under further pressure.
Beginning on February 5, the major economies of the Group of Seven will extend their oil embargo beyond crude to include Russian oil products.
In the first quarter of 2023, this could result in a reduction in Russian oil production of up to 1 million barrels per day (bpd), according to analysts.
A senior Russian source claims that, according to an official forecast, Russia’s oil product output will drop significantly this year, from 272 million to 230 million tonnes.
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