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By Bloomberg

The ruble headed for its third week of declines as oil traded near a six-year low and investors speculated Russia’s credit rating may soon be lowered to junk. Government bonds were set for their best five-day gain on record.

The Russian currency lost 0.1 percent to 65.35 against the dollar as of 12:19 p.m. in Moscow, poised for a weekly depreciation of 5.8 percent. The benchmark Micex Index slipped less than 0.1 percent to 1,562.68, paring a 3.1 percent advance in the past five days. Crude added 1.7 percent to $47.04 per barrel in New York today after touching the weakest level since April 2009 on Jan. 13.

A rout in the commodity, which along with natural gas comprises half of Russia’s state budget revenue, has pummeled the ruble and dragged the economy to the brink of a recession. The currency weakened 7.1 percent this month after sinking 46 percent in 2014, the world’s second-steepest drop after Ukraine’s hryvnia.

“At this level of oil prices, the currency should be at around 75 rubles per dollar,” or 13 percent weaker than today’s rate, Vladimir Miklashevsky, a strategist at Danske Bank A/S in Helsinki, said by e-mail. The currency “is returning to its fair level,” he said.

Crude headed for the longest stretch of weekly declines since 1986 as OPEC forecast weaker demand for its crude, adding to signs that a global supply glut that spurred the price collapse last year may persist.

Negative Watch

Standard & Poor’s signaled last month it may lower Russia to junk from the lowest investment-grade level of BBB- within 90 days, putting the country on negative watch as crude’s plunge and Russia’s role in the Ukraine crisis threaten the economy.

The cut, which may happen as soon as today, would compound pressure on the ruble, Sberbank CIB analysts including Tom Levinson said in an e-mailed note today.

While bets a downgrade is imminent are mounting, the yield on government bonds due August 2023 fell 29 basis points today. That took the decline this week to 182, the strongest performance since the debt was sold in September 2013. Bond yields are still among the highest in emerging markets, data compiled by Bloomberg show.

“More important is not by how much it went up, but just the fact that it can go up after seven months of relentless decline,” Ivan Guminov, a Moscow-based money manager at Ronin Trust, said by e-mail.