The Russian ruble hit a record low against the American dollar on Thursday, breaking the record that had been set the prior day. The exchange rate hit more than eighty-five dollars to one ruble on Thursday.
The Kremlin was not publicly panicking as Dmitry Peskov, spokesman for President Vladimir Putin, said, “I wouldn’t use the word ‘collapse’. The rate is really changing, the rates is volatile, but it’s far from a collapse.” Peskov also said that there are no plans for an emergency meeting.
The ruble’s troubles have stemmed from low gas prices. The price for a barrel of oil sank below twenty-seven dollars on Wednesday, but rose to close just under thirty dollars on Thursday. Russia’s economy is largely oil-based and the economy has taken a hit. Russia’s budget is planned based in part off of the price of oil and this year Moscow is planning off of thirty dollars a barrel. Any problems Russia has been facing were compounded due to a British report that alleges President Putin probably approved of the poisoning of Russian dissident Alexander Litvinenko.
The price of oil has been expected to drop further due to an increase in supply from Iran as that country is freed from economic sanctions.