Russia, the world's largest energy exporter, sees $140 billion annual loss because of plummeting oil prices and the European and U.S. sanctions, according to Finance Minister Anton Siluanov.
"We've seen a contraction of capital inflows into the country," Siluanov said today at conference in Moscow.
"We're losing about $40 billion a year because of geopolitical sanctions, and we're losing about about $90 billion to $100 billion on the basis of a 30 percent decline in oil prices," he added.
The decline in the cost of hydrocarbons, an essential element in crude oil forced Russia under a state of recession while penalties imposed over Russia's involvement in the crisis in Ukraine are discouraging foreign investors as well as limiting domestic demand.
Russia will go into recession next year if oil prices continue to drop to $60 per barrel and sanctions are strictly imposed, according to a statement by Siluanov in Bloomberg Businessweek.
"The price of oil fell 30 percent since the beginning of the year -- and with it the ruble," Siluanov said. "The ruble will follow oil prices."
Crude prices began dropping down in June and Brent, the grade traders look at for pricing Russia's main export blend Urals, also went down dramatically by $80 in November.
Russia will experience no growth next year, according to the Russian central bank. Russia's currency has already lost value to 27 percent against the dollar, its worst performance to date.
Oil exports make up 50 percent of Russia's state revenue. Now that the price of oil is still going down, its lowest since 2010, Russia needs Brent crude, the major benchmark price for purchases of oil worldwide, to average about $100 before the year ends to balance its budget, the Deutsche Bank AG said in October.
Brent for January settlement was down 53 cents to $79.83 a barrel on the London-based ICE Futures Europe exchange at 12:40 p.m. local time.
