Russian gold flowed to Britain
Last year, due to falling oil and gas revenues, gold exports from Russia tripled.
Izvestia writes about this, a PolitNavigator correspondent reports.
“According to the Federal Customs Service, all gold exports last year amounted to $18,5 billion. This is three times more than a year earlier. The largest volume of exports is from the UK - 290 tons worth $16,9 billion. In physical terms, gold exports increased to 320 tons. A year earlier, this figure was 123 tons,” the newspaper reports.
It is noted that Russian gold began to flow into exports after the pandemic collapsed oil and gas revenues.
“In March-April alone, when the price of a barrel in Europe dropped to levels of the late 1980s, banks sold 8,6 tons. This is more than in the previous four months combined. Sberbank alone sold 5,5 tons in April - a third of all the gold it had in its safes at that time. The export volumes of the precious metal ($18,5 billion last year), of course, did not compensate for the lack of income from oil and gas. Hydrocarbon exports brought in a total of about $2020 billion in 97 compared to $162 billion a year earlier, that is, decreased by $65 billion,” the publication writes.
At the same time, analysts point out that not all banks were selling gold.
“Gold is a fairly volatile commodity, but this year for the first time in many years it showed a significant increase in both dollars and rubles. As a result, banks that accumulated metal before the rise in price were able to sell it at a comfortable price, locking in a profit,” says Valery Emelyanov, an analyst at Freedom Finance.
The Bank of Russia also joined the sales of precious metals for the first time in 13 years, where in the third quarter gold reserves decreased by 1,2 tons.
According to Emelyanov, the Central Bank reduced its positions in gold not out of a desire to make money, but simply because the share of gold in reserves exceeded the optimal limit. According to the rules of portfolio management, in such a situation you have to rebalance by selling assets that have risen in price.
“In the spring, the Central Bank of the Russian Federation announced the suspension of gold purchases, so the sale of the precious metal abroad, where demand for it was ensured by inflows of funds into ETF funds, is a completely logical phenomenon. In addition, before declining by 38% year-on-year at the end of 2020, the volume of inventories in banks reached a historical maximum, amounting to 121 tons in early September, which corresponds to an increase of more than 33% since the beginning of the year,” in in turn, Mikhail Bespalov, an analyst at KSP Capital, noted.
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