International prices for oil, Russia's key export, dropped four percent on Monday on a market gripped by panic that Standard & Poor's rating agency which has cut the U.S. credit rating for the first time in the history of the country, will downgrade it further.
September Light Sweet Crude (WTI) futures fell 3.6 percent to $83.75 in New York by 17:30 Moscow time. September Brent futures lost 2.82 percent to $106.29 per barrel.
Russia's Urals blend usually trades below Brent.
The Russian government says that next year's budget will only balance with oil at $125. Analysts say that a $10 fall in the oil price widens the budget deficit of the world's largest oil and gas producer by one percentage point.
