ALEXANDER DERYUGIN “DEMAND FOR RAW MATERIALS IS RECOVERING, AND RAW MATERIALS DOMINATE OUR EXPORTS."

"Basically, 2021 is a rebound after 2020, when many positions fell. Supply chains were actively collapsing in 2020, and in 2021 they started to recover. Many of them are still far from recovering, therefore, we observe a high inflation, i.e. about 7-8% in developed countries (which was the case last time in the 1970s).

However, now a new commodity economic cycle began and that is why the demand for raw materials is recovering (especially amid hopes for an end to the pandemic), and raw materials dominate our exports. This is all the more interesting because we can observe

that gas prices in Europe have grown by an order of magnitude in a year; at least Borrel mentioned a 10-fold growth.

Moreover, Gazprom is accused of not wanting to increase gas supplies to Europe, although, in my opinion, that’s exactly what it did. Many other international suppliers have reduced gas exports, but they still blame Gazprom, saying they expected more! However, nobody thinks that gas has to be produced for distribution or sale and one cannot just take it and sell more than what has been produced.

Returning to the topic of growth in exports and imports, in my opinion, this is exactly the rebound after 2020 plus the inflationary overhang. If you remove inflation from that growth of 45% and 26%, you can reduce each of these indicators by 7-8% because everything has gone up in price and the price has gone up in US dollars. It is not as if the ruble has fallen significantly against other currencies, it did not fall much, by the way, but the dollar did. We can see that due to this fact the metals’ prices are now overheated and oil prices are up to $95 per barrel again. All this contributes to the growth of both the physical volume of our exports and their monetary expression.