Despite western sanctions, Russia's oil and gas revenues rise - Reuters

Compared to the same period last year, Russia's revenues from oil and gas sales have increased by about 41% this year. Reuters writes about this with reference to the data of the Ministry of Finance of the Russian Federation, UNN reports.

Details

The reason for such high incomes is the rise in oil prices and the weakening of the ruble.

It is noted that oil and gas revenues have been the most important single source of cash for the Kremlin, accounting for approximately one-third to one-half of total federal budget revenues over the past decade.

Reuters adds that the price of Russia's flagship Urals crude averaged $69.1 per barrel during the first half of the year, above the $60 price cap imposed by the West, compared to $52.5 in the same period in 2023. At the same time, the ruble exchange rate weakened to 90.8 per $1 in the period from 76.9 in January-June 2023.

The economy grew by 3.6% in 2023 after a revised 1.2% contraction in 2022. Russian economists emphasized the low quality of economic growth, saying that the production of missiles and shells may contribute to GDP growth but will bring limited benefits to the population.

In total, the government has budgeted 10.7 trillion rubles from oil and gas sales for 2024, which is 21% more than in 2023, when lower oil prices and falling gas exports reduced revenues by 24%.

Addendum

Reuters explains that during the first half of the year, the price of Russia's flagship Urals oil averaged $69.1 per barrel, which is higher than the $60 price cap set by the West, compared to $52.5 for the same period in 2023.

At the same time, the ruble weakened to 90.8 per $1 in the period from 76.9 in January-June 2023.

The newspaper added that Russian President Vladimir Putin welcomed the high economic growth rates, saying that they outpace those of Western economies.

Recall

In June, the EU introduced a 14 package of sanctions against Russiain connection with Russia's war against Ukraine, imposing even more restrictions on sectors of the Russian economy such as energy, finance and trade, and making it even more difficult to circumvent EU sanctions.