The expert assessed the consequences of reducing the price of cutting off oil to replenish the NWF

If the scenario of reducing the oil cut-off price is implemented within the framework of the budget rule, oil revenues to the budget will become more limited, Elena Kozhukhova, an analyst at IC VELES Capital, told Izvestia on May 6.

According to her, this should eventually lead to fiscal consolidation and cost reductions.

"As a result, we can expect, among other things, a reduction in the key rate of the Central Bank of the Russian Federation," she added.

The expert noted that the current course of the government of the Russian Federation assumes a further reduction in the share of oil and gas revenues in the budget of the Russian Federation in the coming years, which is planned to be implemented this year by increasing the tax burden, including on the raw materials industry.

"Higher taxes, by analogy with countries that do not have large amounts of natural resources, may also affect individuals in the coming years. In addition, the development of non—oil and gas industries may become one of the ways to a more balanced budget," the expert explained.

Don't stand on the threshold: the cut-off price for replenishing the NWF may be reduced to $50 per barrel

Why do experts consider this level to be appropriate and what will it mean for the ruble exchange rate?

Earlier that day, experts interviewed by Izvestia said that the price of cutting off oil to replenish the National Welfare Fund could be reduced to $50 per barrel Urals. At the end of April, the Ministry of Finance stated that the current $60 per barrel is irrelevant. The cut-off price is the threshold that the authorities target when replenishing the fund. According to the budget rule, if the price of Russian Urals oil is higher, then excess profits go to the "pot" (they buy currency and gold), and if lower, assets are sold from there to support the ruble.