Russian oil revenues fell to a two-year low: details
Kyiv • UNN
Russia's oil revenues fell by 32% year-on-year to 430.4 billion rubles due to falling oil prices. The strengthening of the ruble also contributed to the decrease in revenues from the oil industry.
Russian oil revenues to the state budget fell to their lowest level since June 2023 last month due to falling global crude oil prices. This is reported by Bloomberg, UNN reports.
Details
Oil-related taxes fell by 32% last month compared to the previous year to 430.4 billion rubles ($5.5 billion). Total oil and gas revenues amounted to 512.7 billion rubles, which is 35% less, the report said.
It is noted that crude oil prices have fallen as US President Donald Trump's tariff policy threatens to slow down the global economy, while OPEC+ is accelerating the recovery of its production in a market that was already well supplied. The cartel's production growth, driven largely by Saudi Arabia, sparked disagreement within the Russian-led faction at a meeting last weekend.
Oil and gas are the backbone of Russia's public finances, accounting for about a third of tax revenues. Due to falling crude oil prices, the government has revised its budget forecast and more than tripled its budget deficit target.
According to Bloomberg's calculations, oil revenues in May fell by more than half compared to the previous month. This reflects the fact that one of Russia's main oil taxes — the profit-based levy — is paid four times a year in March, April, July and October.
The Ministry of Finance calculated oil taxes based on the average price of Urals oil in April at $54.76 per barrel, which is more than a quarter lower than a year ago. According to historical data, the price remained below the $60 threshold set by the Group of Seven countries for the second consecutive month to reduce Russia's revenues.
The strengthening of the ruble also contributed to the decline in revenues from the oil industry. The Russian currency rose by 10% over the estimated tax period compared to last year to 83.317 rubles per US dollar.
Earlier this month, Igor Sechin, chief executive officer of Russia's largest oil producer, Rosneft PJSC, criticized the country's central bank for setting an exchange rate that lowers crude oil prices in ruble terms. The Bank of Russia does not aim for a specific exchange rate, but seeks to curb inflation with a key interest rate.
Lower crude oil and petroleum product prices have helped the government reduce the subsidies it pays to refineries to partially offset the difference in fuel prices in Russia and abroad. Last month, the budget allocated 42.5 billion rubles for the supply of gasoline and diesel fuel to the domestic market. This is the lowest figure since October 2023, when there were no payments.