The Russian ruble climbed to its strongest level against the US dollar in two years on Thursday, driven by soaring oil prices and renewed optimism over peace talks in Ukraine, analysts report.
Trading below 78 rubles per dollar in the afternoon session, the currency reached its highest value since mid-May 2023. Analysts attribute the ruble’s momentum to both geopolitical developments and market fundamentals.
The Russian government recently confirmed it had drafted a new peace memorandum concerning the ongoing conflict in Ukraine. Foreign Minister Sergey Lavrov also proposed that negotiations resume in Istanbul on June 2.
The diplomatic overture comes amid a noticeable thaw in US-Russia relations, following US President Donald Trump’s return to office. Trump reiterated that no new sanctions against Russia would be imposed, expressing hope for a peaceful resolution.
Meanwhile, Brent crude — a key export for Russia — gained 1.2% to reach $65.68 per barrel, further bolstering the ruble. Analysts point out that rising oil prices increase foreign currency inflows, which are often converted into rubles at month-end to cover domestic obligations.
“The improved geopolitical backdrop and favorable oil market conditions should offset the typical month-end dip in foreign currency supplies,” said Yevgeny Loktyukhov of Promsvyazbank.
In addition, robust foreign exchange liquidity and tepid demand for foreign currency have created favorable conditions for the ruble’s continued rally, according to Natalia Pyryeva of Tsifra Broker.
Markets are cautiously optimistic, with some analysts forecasting the ruble could strengthen to 75 per dollar if diplomatic momentum continues. However, many warn that sustained gains depend on actual progress in peace negotiations.
Following a productive phone call between Presidents Trump and Putin, and a significant prisoner exchange earlier this month, hopes for a diplomatic breakthrough remain alive — fueling both market confidence and the ruble’s ascent.
