MOSCOW, September 6 (Itar-Tass World Service) - The military attack on Syria will cause huge damages for some or incredible profits for others, the Komsomolskaya Pravda writes. “What most people don’t seem to realize is that there is just as much money to be made out of the wreckage of a civilization as from the upbuilding of one,” the newspaper quotes a character of an American novel Gone with the Wind.
“All the military conflicts in the Middle East have forced up oil prices in global markets,” the Komsomolskaya Pravda quotes Head of the Institute of Religion and Politics Alexander Ignatenko as saying. “Should the military intervention begin, the entire oil region may be set on fire.”
Foreign experts say bombarding of Syria will push oil prices to $150 a barrel. “Oil goes up due to expectations,” Alexei Yazykov, ATON’s Head of Strategic Analysis Department, told the newspaper. “Fear has a hundred eyes. While the invasion is only in plans, nobody can be sure about the scale or consequences. Usually, investors expect the worst. Thus, the history of all recent military conflicts demonstrates oil prices growing at first and falling later. This is what is going to happen this time, too. There are limits to price growth. Expensive energy resources will slow down even more the global economy, which is barely alive. Demand is dropping, and the prices are falling. Thus, despite any global wars, oil prices cannot be $200-250 a barrel, at least in the current economic conditions.”
Realistically, expensive oil affects the dollar. This means the ruble is growing, the Komsomolskaya Pravda says. “First of all the oil prices’ jump will be short-term, and secondly, whatever uneasy situation is there in the world, investors prefer to remain in dollar assets,” Yazykov continued saying. “Thus, my forecast is that the dollar rate will be growing.”
Bank BKF’s Head of the Analytical Department Maxim Osadchiy agrees with the forecast: “The conditions for ruble are negative. But the Central Bank still has enough gold and currency reserves to control the rate. In August only, the Central Bank spent six billion dollars not to allow ruble fall by over ten percent, though at that very time India’s rupee did fall by ten percent. I believe the Central Bank will continue supporting the national currency, though not at any price. They are most likely to damp the falling.”
“Explosions of American bombs in Syria are likely to frighten investors in Russia. The capital continues fleeing,” Osadchiy said. “In any military conflicts, investors are escaping from emerging economies. They may consider us to be even an injured party, as we have failed to prove our position. If Assad’s regime is overthrown, we are most likely to be a loser, like it happened both in Iraq and in Libya.”
“A long-lasting slump will continue at financial platforms, and while the US stock indexes may drop by 15-20% maximum, the emergency markets may repeat the scenario of year 2008,” Investcafe’s Analyst Alexei Pukhayev said. “Besides, the military costs of operation against Syria may be colossal. The estimates forecast about one billion dollars a month. Expenses of the kind contradict the White House’s aspirations for lower military costs.”