The outbreak of the novel coronavirus is already hurting trade with China, as supplies from the country have shown the first decline, the First Deputy Head of Russia’s Federal Customs Service Ruslan Davydov told a press conference on Monday, according to TASS.
“There has been a certain decline (of imports) from China to Russia. However, that is probably due to the actions of the Chinese authorities and the actions of the Chinese businessmen in the first place. We currently evidence a certain decline in supplies of goods, particularly of fruits and vegetables, in the Far Eastern region. As we understand that is related to the coronavirus, though how the situation will unfold should be judged by China itself,” he explained.
The government has decided to substantially restrict citizens, tourists from crossing the border in the border areas of the Far East, Davydov noted, adding that no restrictions were imposed on transportation of goods.
Oil prices were the first to react given that China is one of the biggest consumers of the raw material. Demand for fuel in China has fallen and dollar prices for oil have collapsed. In January, Brent oil fell 12.6 percent, while Russia’s Urals oil dropped in value in both dollar and ruble terms. On February 10, Urals oil hit a two-year low, falling below 3,400 rubles ($56) a barrel. This price is already below the one written into the federal budget. As a result, the ruble exchange rate has shifted, albeit not yet critically: Since early January, the ruble has lost 3.35 percent against the dollar.