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MOSCOW, July 5 (Reuters) - The Russian finance ministry will hugely reduce daily purchases of foreign currency for state coffers in July as its extra oil and gas revenues evaporated, the ministry said on Wednesday.
The ministry would buy 74.3 million roubles ($1.24 million) worth of foreign currency between July 7 and August 4 after spending 45 billion roubles on such purchases in the preceding month.
On daily basis, the forex buying will amount to around 3.5 million roubles ($58,000), the finance ministry said in a statement, down from 2.1 billion roubles between June 7 and July 6.
“A relatively low volume of extra oil and gas revenues was mainly caused by a decline in oil prices in June on the back of the comparatively stable rouble rate,” the ministry said in a statement.
Prices for Russia’s Urals crude oil blend dropped to $42.93 in June URL-E, their lowest since November, denting the country’s revenues from commodity exports.
The announced amount of interventions came far below market expectations. Analysts polled by Reuters had on average expected the finance ministry to reduce its average daily foreign-currency purchases to about 1.31 billion roubles in July.
The finance ministry started buying foreign currency on the domestic market in February to replenish the country’s fiscal buffers.
The ministry said the purchases are designed to shield the oil-dependent economy from swings in oil prices but some analysts interpreted them as an attempt to stop the rouble from strengthening too much. ($1 = 59.8800 roubles) (Reporting by Polina Nikolskaya; Editing by Andrey Ostroukh and Toby Chopra)