By Emre Gürkan Abay
Russia Letter – Moscow – week beginning April 18

 - Agreement failure at Doha meeting

The failure of OPEC and non-OPEC countries to reach an agreement on production levels at Sunday’s meeting will most probably be the top issue for discussion in Russia this week.

As its economy is heavily dependent on oil exports, the Russian markets have already reacted to the disappointing outcome of the oil meeting on Sunday.

Meanwhile, Alexander Novak, Russia’s energy minister, accused Saudi Arabia and some Gulf countries for the failure to reach an agreement during the oil summit.

The minister said that while most oil producing countries were eager to reach an agreement about freezing oil output, Saudi Arabia and some Gulf countries changed their opinions at the last minute and prevented a common ground to be found among the participants at the summit.

- Russian markets

The Russian ruble weakened by nearly 3.5 percent against the dollar on Monday and dropped to 68.69 levels, while against the euro, it dropped by nearly the same amount and decreased to a level of 77.62.

The country’s stock markets have also experienced losses on the first trading day of the week.

Moscow Stock Exchange (MICEX) indexes dropped by 0.8 percent to 1.892 points and the RTS indexes decreased by 3.88 percent and declined to 871 points.

- “Direct Line” with President Putin

Russian President Vladimir Putin’s “Direct Line” event, where Russian citizens are given the opportunity to ask questions to the President directly, was the most discussed development last week.

During Putin’s 3 hour and 40 minute long program, most questions asked were related to economic problems in the country.

The president stressed that the Russian economy would continue to shrink this year by 0.3 percent and admitted that inflation was a significant problem in the country at the moment.

- Russian inflation, poverty levels

With inflation up to 15.5 percent in 2015, the increase in poverty is another consequence of the economic crisis in Russia.

The number of Russians with incomes below the poverty level ($120 per month) increased to 13 percent last year.

According to Rosstat, the country’s official statistics agency, the poverty rate in Russia was 11.2 percent in 2014 and 10.8 percent in 2013.

19 Apr,2016