The European Commission stated about a “double blow” on Russia: Russia is waiting for a big drop in GDP

European Commission experts have analyzed the economic decline of Russia in the epidemic of the coronavirus and stated that the Russian Federation has received a double blow in the form of a sharp decline in oil prices and falling domestic consumption as a result of restrictions imposed due to the outbreak of coronavirus. The European Commission has predicted the fall of Russia’s GDP, more than double the effect of the imposition of sanctions for the Crimea and the Donbass.

This is reported by news Agency by publishing a new forecast of the European Commission.

European analysts believe that Russia’s GDP will fall by 5 % .

It is noteworthy that in the autumn the European Commission has projected weak growth in Russia at the level of 1.4 % per annum, however, the coronavirus pandemic and the collapse of world oil prices has forced them to radically change their opinion.

“Russia received a double blow in the form of a sharp decline in oil prices and falling domestic consumption as a result of restrictions imposed due to the outbreak of COVID-19”, — noted in the message.

The report States that entered the territory of Russia the restrictions will negatively affect the economic processes in Russia that will result in a reduction of the company’s income and population.

The biggest deterioration will suffer small and average Russian business. Its contribution to GDP decline will make and external trade: prices of commodities that serve as the basis of Russian exports, fell sharply. The basis for the formation of the Russian budget are the sale of hydrocarbons, the prices of which fell sharply.

“Against this background, real GDP is likely to decline in 2020 by 5% more than in 2015 (-2.3%), when the blow to the economy caused the previous crisis, the decline in oil prices and Western sanctions”, — the report says the EC.

As previously reported, all oil companies in the world have suffered significant losses after the beginning of the oil war in March.

In April, Russia capitulated and agreed to all conditions of the partners. In the end, the deal OPEC+ was agreed upon, however, the situation on the fuel market is still far from stable.