The Russian ruble fell to an all-time low on Jan. 20, trading at 82 rubles per U.S. dollar. The 4 percent drop in the currency’s value comes as the Russian economy struggles with a recession.
The ruble’s tumble came as the price of oil continued to fall, reaching less than $27 per barrel, reports CNN Money.
The Russian government is dependent on petroleum exports for roughly half of its annual revenue, according to the AFP.
The Russian ruble has fallen by over 12 percent during the year of 2015, as the country’s currency has slid to nearly 92 rubles per euro. Low oil prices and sanctions have plagued the Russian government over the course of 2015.
Many analysts are expressing doubts in the Russian economy’s ability to recover from low oil prices and a weak ruble.
“The latest slide in oil prices has obviously darkened the outlook for Russia’s economy," Neil Shearing, an economist at Capital Economics, told CNN Money.
Russia would reportedly have to sell its oil for $82 per barrel to reach a balanced budget.
Business owners and officials in Russia are still expressing hope in the economic future of their country.
“The current situation is challenging, but the significant depreciation of the ruble made our national production more competitive," Alexey Mordashov, CEO of a Russian mining company, said. "I hope that Russia is reaching some kind of new equilibrium.”
Russian officials have said that they plan to cut spending to keep pace with falling revenues and low oil prices, the AFP notes.
“The exchange rate is really changing, the rate is volatile, but it is far from being a collapse,” Dmitry Peskov, a spokesperson for the Kremlin, told local media, according to the AFP.
Anton Tabakh of Moscow’s Higher School of Economics expressed his doubts regarding the Kremlin’s response to the currency plunge.
“Is is understood that this is happening against a background of an international collapse with local factors being a part of it, but the lack of a reaction from the central bank and authorities raises some questions," he told the AFP.
On Jan. 19, the International Monetary Fund predicted that Russia’s economy will face a 1 percent contraction over the course of 2016.