The Russian ruble weakened sharply against the US dollar and euro, amid decline of oil prices.

Photo: KUN.UZ

The fall in oil demand is recorded against the backdrop of the spread of coronavirus infection. A few days ago, the OPEC+ countries were unable to agree on an additional reduction in oil production at the negotiations, held in Vienna.

The price of Brent crude oil fell to $31.5. On March 9, the euro exchange rate approached the mark of 84 rubles, and the US dollar – 73 rubles.

How will all this affect the economy of Uzbekistan?

Director of the Center for Economic Development, well-known economist Yuliy Yusupov told Kun.uz that the fall in oil prices led, first of all, to the depreciation of the Russian ruble.

“Most likely, the Kazakh tenge will also fall. Russia and Kazakhstan are the largest buyers of goods from Uzbekistan. At the same time, the income of Uzbek external labor migrants comes from these countries,” he said.

Yuliy Yusupov believes that “if the fall in oil prices continues, if ruble and tenge exchange rates go up, then foreign currency earnings from exports and labor migrants will decrease.”

“If the foreign currency becomes less in the country, then the soum will begin to fall (the US dollar will go up). That is, if the drop in oil prices is “serious and lasts for a long time”, the devaluation of the soum is inevitable,” the economist concluded.