Last month, Russia's government paid oil companies its largest subsidy in more than four years for supplying motor fuel to the domestic market, amid drone strikes on oil refineries. Bloomberg reports, UNN writes.
Details
According to data from Russia's Finance Ministry published on October 5, subsidies amounted to 305.5 billion rubles ($3.6 billion) in September. This was the highest monthly payment since April 2022, when a record figure was recorded.
Strikes on Russian oil assets reportedly reduced petroleum product production in Russia, leading to gasoline shortages across the country, fuel rationing, and long lines at gas stations.
These payments "provide vital support to Russian producers that have been forced to carry out extensive unscheduled repairs at refineries that reduced or completely halted operations after the strikes," the publication writes.
However, the payments, as noted, "are eating into Russia's state coffers." According to Bloomberg calculations based on ministry data, September's subsidies fell only slightly short of the total net revenue of 323.3 billion rubles paid by the oil industry into the state budget last month. Since the beginning of the year, the subsidies have exceeded $14 billion, according to the calculations.
Subsidies to refineries are calculated based on the volume of motor fuel supplied to the domestic market and the difference between domestic and export wholesale prices. To ensure incentives for the oil-refining industry, payments continue even amid the current bans on fuel exports. The government in Moscow has imposed a ban on most exports of gasoline, diesel fuel, and aviation fuel. The ban on diesel fuel exports is in effect until the end of October.
Most of the payments go to the country's largest oil companies, including PJSC "Rosneft" and PJSC "Tatneft," as they operate the country's key refineries. To ensure sufficient supplies to the domestic market, the Russian government has also reportedly authorized payments to fuel importers.
President of Ukraine Volodymyr Zelenskyy said in a Reuters interview over the weekend that his country would double its efforts to strike Russian energy facilities in response to devastating round-the-clock attacks on Ukrainian infrastructure.
Russia expects subsidies for the whole of 2026 to reach 1.93 trillion rubles and fall to 1.18 trillion rubles the following year, Russian media reported on Friday, citing documents submitted to the State Duma along with the 2027–2029 budget draft.
Russia's total net revenue from oil and gas reached 452.4 billion rubles in September, more than 22% lower than a year earlier, according to Bloomberg calculations based on data from Russia's Finance Ministry. The decline occurred despite an increase in the price of Russian Urals crude compared with last year and the ruble's weakening against the U.S. dollar. The decline in net revenue from the oil and gas industry was driven by large fuel subsidies, the publication writes.
Russia increases oil exports to record level amid falling prices - Bloomberg30.06.26, 17:07