Worst of crisis over for Russia, but country needs to adjust to life with cheap crude

“We are aware of the high dependence of our economy on the price of our traditional export products – oil, gas and their derivatives. We proceeded from the fact that the average price for Brent will be $100 per barrel,” said Putin during his annual televised press conference on Thursday.

READ MORE: Crude falls below $35 a barrel for first time since 2009

“When the price dropped from $100 to $50 per barrel we planned the budget considering these figures. Now the price is $38. We are forced to revise again,” Putin said.

Global oil glut to persist in 2016 – IEA

Putin said low oil prices have dragged down the Russian economy, but it’s slowly recovering and the worst of the crisis is behind.

“It is a 3.7 percent GDP contraction, 12.3 percent inflation. The real income of the population has fallen, the investment in fixed assets decreased by 5.7 percent. However, statistics show that the crisis in the Russian economy as a whole has passed its peak. From the second quarter, there are signs of stabilization in business activity. In September and October, GDP grew by 0.1-0.3 percent compared to the previous month,” he said.

The President also addressed concerns over using the country’s reserves to fill the hole in the budget left by falling crude prices. In October, Russian Finance Minister Anton Siluanov said the nation’s Reserve Fund could be depleted in 2016, forcing the government to dip into its last remaining reserve, the National Welfare Fund.

“Our foreign reserves stand at $364.4 billion. They’ve depleted a bit, but it’s still a very solid figure,” said Putin.

READ MORE: Moody’s changes outlook on Russian bond rating to stable

Later on Thursday, the Central Bank of Russia reported that the country’s international reserves had grown almost $7 billion in the second week of December to $371.2 billion.