For a net oil importing country, an increase in the price of oil acts as a growth headwind, forcing consumers and the economy as a whole to pay more for their energy consumption. Conversely, rising prices act as a growth tailwind for major net oil and gas exporters like Saudi Arabia and Russia, because they earn more revenue on every exported barrel ♛of crude.

Net Importers Are Hurt by Rising Oil Prices

When oil prices rise, 澳洲幸运5开奖号码历史查询:net importers of oil pay the price. Net importers are countries that import more oil than they export. An increase in oil prices is more costly for countries producing little oil relative to what they consume, including Japan, China, Germany, India, and South Korea.

In the U.S. the burden of high oil prices on consumers is at least partly offset by the benefits to a domestic oil industry now once again producing more crude than any other country. In late 2021 and early 2022, U.S. consumers coped with significant increases in energy prices. While the U.S. became a net petroleum exporter in 2020 in a historic shift, the 澳洲幸运5开奖号码历史查询:U.S. Energy Informatಌion Administration (EIA) expected a return to net importer status in 2022.

Net Exporters Benefit as Oil Prices Increase

Net energy exporters like Russia, on the other hand, see their export revenues rise alongside crude oil and natural gas prices. Oil and gas accounted for 60% of Russia's exports and 39% of federal budget revenue in 2019. The energy sector is estimated to contribute up to 25% of the country's 澳洲幸运5开奖号码历史查询:gross domestic product (GDP).

Conversely, when energy prices drop, big exporters like Russia suffer. The 2014 澳洲幸运5开奖号码历史查询:oil price collapse badly hurt Russia's economy. Between June and December 2014, the Russian ruble declined in value by 58 to 60% relative to the U.S. dollar, fueling inflation that forced the Russian central bank to raise interest rates as high as 17%. As a result, R𒆙ussia's PPP decreased from 3.76 trillion in 2014 t🌠o 3.53 trillion in 2015.

Russia also receives less economic benefit from lower pump prices than the U.S. does, because Russians consume much less oil and gas than Americans. In 2021, with crude oil prices hitting seven-year highs, Russia reaped a windfall. Budget revenue increased 35% from 2020, while its current account surplus rose to 7% of GDP. Higher energy prices supported a broad economic recovery, with GDP up 10.5% year-over-year in Q2 2021 before slowing to a 4.3% annual gain as of Q3. Every month between January🌃 2023 and April 2024, Russia exported €750 million per month of oil.

The Bottom Line

Russia’s economy is heavily reliant on oil exports, which contribute significantly to its GDP and government revenue, making it highly sensitive to global oil price fluctuations. Rising oil prices benefit Russia by strengthening the ruble, boosting export revenues, and supporting government spending, while falling prices lead to fiscal deficits, a weake🎃r currency, and economic challenges.