Russia energy revenues decline despite rising oil prices

Russia’s federal budget revenues from oil and natural gas fell 17.2% year-on-year during the first nine months of the year, totaling 5.47 trillion rubles ($67.7 billion). This represents a loss of approximately $14.1 billion in the energy sector, according to the Finance Ministry.

Several factors contributed to this decline despite a surge in global oil prices. The appreciation of the ruble against the US dollar meant that export revenues converted into fewer rubles for tax calculations. Additionally, Ukrainian drone attacks on refineries have impacted production and exports. While the average price of Urals crude rose to over $92 a barrel in September, the Finance Ministry noted that the impact of these higher prices on the budget may be delayed.

To address intensifying strain on state finances caused by military spending and a swelling budget deficit, the Kremlin is pursuing new revenue streams. Proposed measures for the 2027-2029 state budget include tax hikes targeting mining companies and wealthier citizens with investment, property, or bank income.