Russia Perhaps Soon Fourth Biggest Gold Holder
For the first time in eight years, Russia can overtake Saudi Arabia as the fourth biggest holder of foreign currency reserves, precious metal, and other securities, according to a Bloomberg assessment.
Russian gold and foreign exchange reserves are set to outstrip those of Saudi Arabia, allowing Moscow to “leapfrog” Riyadh in international rankings, while the top spots are held by China, Japan, and Switzerland, according to Russian media.
The steadily growing stockpile would likely provide Russia with increased influence within OPEC and stabilize its national currency, the rouble, even in the event of plummeting oil prices. Sputnik News reported.
The assessment was made by Bloomberg analysts, who concluded that Russian international reserves have grown by 45 percent over the past four years, while according to the data released by the Central Bank of Russia, the figure amounted to roughly $520 billion in late July.
Over the same four-year span, Saudi gold and foreign currency reserves have shrunk by a quarter, from $700 billion in April 2015 to $527 billion in June 2019, thus reducing the gap between Moscow and Riyadh.
Intriguingly, both economies are dependent on hydrocarbon exports — and the situation on the oil market is increasingly uncertain, as Russian media wrote.
According to a monthly report by the International Energy Agency (IEA), in the first five months of 2019, world demand for black gold grew by only 520,000 barrels per day, which is the lowest figure since the financial crisis of 2008.
If developments unfold this way, Saudi Arabia will have to spend money from its reserves, while in Russia the situation is different.
In the past few years, Russia has steadily stockpiled gold, becoming the world’s largest buyer of the precious yellow metal in the first quarter of 2019, while simultaneously drastically reducing its US Treasury holdings as part of a so-called de-dollarization drive (from $160 billion in early 2013 to $10.8 billion in June 2019).