Leucadia National Corp
A declining ruble exacerbates Russia’s banking woes
Limited access to international capital and inflating external debts are just some of Russia’s banking woes.
Why Ocean Rig’s large backlog supports its future MLP profits
The backlog has grown from $1.6 billion in early 2012 to $5.8 billion today, which is equal to nearly five times today’s revenue.
Russian banks try to recapitalize due to low international reserves
The Bank of Russia has been digging into reserves in an attempt to defend the depreciating currency. These reserves shrunk by about 20% this year.
Why Russia’s Industrial Production Fell in September
According to the Federal State Statistics Service, Russia’s industrial production index (IIP) fell to 3.7% in September, compared to a fall of 4.3% in August 2015, YoY.
Russia’s Industrial Production Contracts Again, RSX Falls 0.49%
Russia’s woes have only deepened with the Federal State Statistics Service releasing industrial output figures for July.
Comparison of US and Russian Energy Companies’ Moving Averages
ExxonMobil and Chevron are trading above their 100-day moving averages by 1% and 4%, respectively.
Industrial Production Contracts in Russia in June, RSX Falls 1.6%
Industrial production in Russia declined by 4.8% in June on a year-over-year basis. The Russian equity–tracking VanEck Vectors Russia ETF (RSX) was down 1.6%.
Russian Consumer Confidence Is on the Rise
Several macroeconomic indicators are suggesting that the Russian (RSX) economy is improving.
Falling Crude Prices Dragged Russia’s Trade Surplus in November
With Russia’s falling trade surplus, the iShares MSCI Russia Capped ETF and the Direxion Daily Russia Bull 3X ETF have fallen 16.6% and 60.9%, respectively.
Russia’s Inflation Is Still High at 15.3% in June, RSX Down 2.01%
Russia’s inflation rate stood at 15.3%, according to a July 6 release by the Federal Statistics Service in Russia.
Industrial Production in Russia Contracts: RSX Increases 1.51%
Industrial production in Russia declined by 5.5% in May on a YoY basis. The Russian economy has seen a slowdown over the past year amid a global drop in oil prices.
Could Russia Become a Favorite among Emerging Markets?
The VanEck Vectors Russia ETF (RSX), which tracks the performance of Russia, showed a massive recovery.
Did Russian Energy Companies Outperform in 2Q15?
In 2Q15, the average falls in sales of US-based energy companies were higher than those of their Russian peers.
Unemployment Fell in Russia, Yet RSX Is Down on Oil Woes
According to the August 19 release of the Federal Service of State Statistics, the unemployment rate in Russia edged down by 0.1% to 5.3% in July.
How Has the Russian Stock Market Changed?
The Russian stock market is upbeat, which adds to the ruble’s strength.
Why Jeffrey Lacker says the Fed should focus on its dual mandate
Monetary policy is one of two tools the government uses to control the economy. Fiscal policy is the other tool.
Could New Sanctions Impact Russia’s Manufacturing Activity?
Improvement in operating conditions in Russia In July 2017, operating conditions in Russia improved at the fastest pace since January 2017. The Russian PMI (purchasing managers’ index) increased to 52.7 from 50.3 in June 2017. New orders and output saw the strongest expansion, each reaching a six-month high. The surprising improvement in the manufacturing sector comes […]
Is Russia’s Manufacturing Sector Losing Momentum?
Russia’s manufacturing activity improved at a slower pace in April due to weaker demand. Growth in output and new orders slowed to eight-month lows.
Why the IMF Expects Brazil and Russia to Remain in Recession
The IMF expects the economy of Brazil to fall 3.3% in 2016, following its 3.8% decline in 2015.
How the Weak Ruble Is Affecting Russian Oil Companies’ Cash Flows
Lukoil’s free cash flow has gone up by 372% in 4Q15 compared to 4Q14 in ruble terms.
Why Has the Stronger Dollar Affected Russian Oil Giants?
Cash reserves for Lukoil (LUKOY), the second-largest oil-producing company based in Russia (RSX)(ERUS), went up by 372% in 4Q15 compared to 4Q14.
The Russian Economy Has Been Hurt by Crude, Economic Sanctions
The Russian economy remained in recession after having declined by 3.8% in 4Q15 from a year ago. The figure was released by Russia’s Federal Statistics Service.
Looking for the BRIC in the Wall
In this series, we’ll look at how the active and passive funds focused on the BRIC nations have performed. A variety of incidents and developments have led to the loss of investor confidence in these economies.
Why Russia’s Plans to Raise Crude Prices Might Have Failed
Russia plans to raise crude prices by boosting confidence among investors and capping the production at January 2016 levels may not succeed.
Did Russia Follow the New Crude Oil Production Deal?
The Russian Energy Ministry reported that Russia produced 10.88 MMbpd of crude oil in February 2016. It produced 10.989 MMbpd in January 2016.
Why Inflation Is a Double-Edged Sword for the Financial Market
Core inflation could impact the market positively as well as negatively. Higher core inflation data will depreciate the US dollar (UUP).
Is Syria or Something Else Bothering Top Oil Exporters?
Russian officials indicated a possible crude oil production cut meeting with OPEC. However, there hasn’t been an official response from OPEC.
Iran’s Role as a Leading Supplier of Nonrenewable Energy
In November 2015, Iran’s oil minister announced a new model of contracts for foreign oil and gas companies during a two-day conference in Tehran. The new framework allows foreign investors to retain the oil fields for a longer period.
Why Does the Conflict in Syria Affect Russia so Much?
Russia’s energy exports have been hurt by falling crude oil prices. Meanwhile, Saudi Arabia has become engaged in a price war with US shale oil producers.
Why China’s Trade Deal with Iran May Hurt Russian Energy Exports
Per the EIA, in 2013, crude oil constituted 68% of Russia’s total exports and 16.4% of its GDP. Also, Europe (FEZ) and Asia account for a significant portion of Russia’s crude oil and natural gas exports.
Fiscal Break-Even Cost for the Top Oil-Dependent Economies
In its recent outlook, OPEC stated that crude may not reach $95 by 2040. The fiscal break-even cost for different OPEC countries is more than $70 per barrel.
What Do the Attacks in Turkey Mean for Natural Gas?
Rising violence in Turkey could directly impact the possible natural gas pipeline from the Middle East. Turkey is an important land transit route.
Constant Turmoil: Analyzing Geopolitical Tensions in Turkey
Gazprom PAO is closely related to the geopolitical tensions in Turkey. Instability in Turkey raises questions about the gas pipeline from the Middle East.
Russia’s Gas Pipeline Network in Europe
The European Union (FEZ) depends mostly on imports to meet its gas needs. Europe accounts for a significant portion of Russia’s gas exports.
Leadership in Tehran Keen on the Withdrawal of Sanctions
The new leadership in Tehran that came to power in 2013 was mostly elected on economic promises. Soon after, it attempted to normalize ties with the US.
Iran and Russia’s Ties Grow: How Far Can That Continue?
The growing ties between Iran and Russia may be based on lower crude oil prices. North America is also not a significant market for Russian energy exports.
Iran May Plan to Increase Gas Supply in Europe and Asia
Geographically, Iran is between the European and Asian gas markets. Both Europe and Asia consume significant portions of the world’s natural gas production.
Russia’s Growing Influence in the Middle East—and How It’s Sitting with Saudi Arabia
With Russia involved in Syria, Assad’s war against rebel groups and ISIS has intensified. This directly impacts Saudi Arabia’s financing in the war.
Will Russia Intensify the Invasion in the Middle East?
North America accounts for a small portion of Russia’s energy exports. Mining energy-producing minerals attracted 14.7% of the total fixed capital investment in 2014.
OPEC Might Not Cut Production: What Does It Mean?
OPEC’s outlook was released in December 2015. It included facts about diminishing oil demand by 2040. By 2040, oil might have alternatives.
Saudi Arabia May Not Want Sanctions on Iran to Be Lifted
Saudi Arabia’s direct oil export through the sea is possible in two ways, one is through Bab el-Mandeb, and the other runs parallel to Iranian water boundaries.
Russian Manufacturing Contracts in December
According to Markit, Russia’s manufacturing PMI (purchasing managers’ index) declined by 1.4 points and came in at 48.7 in December, as compared to 50.1 in November 2015.
Yemen Could Be a Pivotal Point for Crude Oil in 2016
Yemen has been destabilized by Houthis fighters. Iran supports the fighters on religious and political grounds. Yemen is a small oil-producing country.
Russia and Saudi Arabia Are Engaged in a Proxy War in Syria
Saudi Arabia and Russia both differ in Syria. Saudi Arabia pressured Russia (RSX) to withdraw its support of Bashar al-Assad—Syria’s president.
OPEC Members Are Facing High Fiscal Deficits
OPEC stated that crude may not reach $95 by 2040. The fiscal break-even cost of different OPEC countries lies around more than $70 per barrel.
The Slide in Oil Prices Impacted Russia’s Budget Revenues
The decline in oil prices is a result of the price war between US shale oil producers and OPEC, where each is pumping oil into the market—leading to oversupply—in an attempt to retain market share.
Russia Could Eye Yemen in 2016, Might Spur Oil
The price war made life difficult for Russian energy companies and Russia’s economy at large. Asia and Europe are two important markets for Russia.
The Break-Even Costs of the World’s Top Oil Producers
Venezuela accounted for 17.5% of the world’s total proven crude oil reserve in 2014. According to a study by BP, Venezuela’s break-even cost is ~$23.5.
What Could Impact the Eurozone’s Economy in 2016?
Russia’s growing differences with NATO could impact Europe’s economy. Russian energy exports meet most of the EU’s energy requirements.
How Rising Inflation Is Affecting the Russian Economy
Like Brazil (EWZ), Russia (RUSL) (ERUS) is also struggling with high inflationary pressure. For the September quarter, Russian GDP (gross domestic product) fell 0.57%.
Russia and Saudi Arabia Play Hide and Seek in Syria
Russia’s presence in Syria is a threat to Saudi Arabia. There’s already cut-throat competition in the crude oil market. This increases the geopolitical tension.
How Long Can the Price War Continue in Crude Oil?
According to data compiled by Rystad Energy, the cost of production per barrel of crude oil is $17.20 in Russia—compared to $9.90 in Saudi Arabia.
Iran Could Struggle to Get Regional Leadership in the Middle East
Iran’s economy has been crippled due to sanctions. Iran accounts for 9.3% of the world’s total proved crude oil reserve. It’s one of OPEC’s leading producers.
Could Iran Become a Big Gas Supplier to Europe and Asia?
Geographically, Iran is between the Europe and Asia’s gas markets. Iran could be a potential supplier to China (FXI) through Pakistan and India (INDY).
Nord Stream Pipeline: A Russian Gas Pipeline to Europe
The EU (European Union) mainly depends on imports to meet its need for gas. Europe imports a significant amount of gas from Russia.
Saudi Arabia is Critical for Western Nations
Saudi Arabia is an important ally for the US (SPY) in the Middle East. Saudi Arabia is also a strategic point to fight against terrorism in the Middle East.
OPEC Accounts for Most of the World’s Crude Oil Reserves
BP’s (BP) statistical review shows that OPEC (Organization of the Petroleum Exporting Countries) accounts for 71.6% of the world’s total proved crude oil reserves.
Russia’s Manufacturing PMI Was Little Changed in November
Russia accounts for about 1.8% of the world’s GDP, and manufacturing activity accounts for ~15% of Russia’s GDP. Russia’s manufacturing PMI declined slightly to 50.1 in November, compared to 50.2 in October.
Iran Is Getting Ready to Supply Natural Gas and Crude Oil
Last week, Iran’s oil minister announced a new model of contracts for foreign oil and gas companies during the two-day conference in Tehran.
Iran Could Supply Natural Gas to Europe and Asia
Geographically, Iran is between the European and Asian gas markets. Iran could be a potential supplier to China through Pakistan and India (INDY).
Understanding the Gas Pipeline from Russia to Europe
Europe is a lucrative market for Russian gas manufacturer Gazprom Pao, as it derives more than 50% of its revenue from overseas.
Russia Dependent on Prices of Crude Oil and Natural Gas
experts feel that OPEC is experiencing trade challenges with Russia in Asia due to crude’s falling prices, narrowing profit margins, and geopolitical issues.
Why Is Indonesia Important as a Net Importer of Oil for OPEC?
Indonesia is looking for a long-term strategic alliance to support the demand of crude oil for its economy. Since 2003, Indonesia has been a net importer of oil.
Russia’s Downed Jet: A Game-Changer for Commodity Sentiment?
As John McCain has stated, “Russia is a gas station masquerading as a country.” Today, Turkey shooting down the Russian fighter jet has set the equation.
Russian Energy Companies’ Debt Grew More than Their US Peers’
The weighted average cost of debt for Russian energy companies stands at 9.6% compared to 1.5% for their US peers.
Sinking Oil Prices Rattled Stock Markets and Russia’s GDP Growth
Because of the supply glut in oil, prices fell steeply, affecting energy stocks and Russia’s GDP growth rate. Oil is currently priced at ~$42 per barrel.
Why Economic Growth in Russia Fell by 4.3% in September
According to the Federal Service of State Statistics, the gross domestic product (or GDP) of Russia has fallen 4.3% for the third quarter.
Russia’s Trade Surplus Falls along with Crude Oil Prices in August
According to the Central Bank of Russia, the goods and services surplus fell to $8.7 billion in August 2015, compared to $16.2 billion a year ago.
How Will the Iran Deal Affect Russia?
Although Iran’s return to the oil market won’t lower oil prices immediately, Russia (RSX) will have to take measures against the subsequent fall in oil prices.
What Has Boosted the Russian Ruble in 2015?
The Russian ruble owes its strength to tax payments that exporters will make this year. The exporters are required to convert their earnings in foreign currency into rubles.
The Russian Ruble Has Hit New Highs in 2015
The Russian ruble hit a new 2015 high on July 13 of 56.375 against the US dollar and 62.74 against the euro.
Russia’s Key Rate Decreased to 11.5%: RSX Increased 2.04%
In what was perceived as positive news by investors in the Russian economy, the Central Bank of Russia cut its key interest rate by 100 bps to 11.5% on June 15.
Russian anti-crisis plan targets a surplus by 2017
Siluanov confessed that Russia would have to put certain projects on ice for the time-being to finance the anti-crisis plan. But Crimea will go ahead.