Moscow — Russian state oil and gas revenue may fall in November by around 35% from the corresponding month in 2024 to 520 billion roubles ($6.59 billion) due to cheaper oil and a stronger rouble, Reuters calculations showed on Monday.
The decline in proceeds is painful for Russia, which has heavily boosted defence and security spending since launching its military campaign in Ukraine, which it calls a special military operation, in February 2022.
Oil and gas revenue has been the most important source of cash for the Kremlin, making up a quarter of total federal budget proceeds.
The revenue, gained from taxing profits, is also set to decline by 7.4% from October, excluding cyclical payments.
For the first 11 months as a whole, oil and gas revenue is seen falling by 22% to 8 trillion roubles.
According to Reuters calculations, the price of Russian oil for tax purposes declined in January-November, to stand at $57.3 per barrel, compared to $68.3 in the same period last year.
At the same time, the rouble has strengthened to 81.1 per dollar from 91.7 in January-November 2024. The Finance Ministry will publish its estimates on December 3.
Ukraine and its backers in Western Europe have repeatedly said they want to force Russia, the world’s second largest oil exporter, to stop its war by undermining its economy.
The U.S. Treasury said on November 17 that U.S. sanctions against Russian oil majors Rosneft and Lukoil were already reducing Moscow’s oil revenues and were likely to reduce the quantity of Russian oil sold in the long term.
President Vladimir Putin has repeatedly said that Russia will never be forced into doing anything and that, though sanctions can cause pain to the Russian economy, it can survive and even prosper without the West.
The Finance Ministry had initially expected to earn 10.94 trillion roubles from oil and gas sales this year, but falling oil prices led it to revise down that expectation last month, to 8.65 trillion roubles.
Oil and gas revenue reached 11.13 trillion roubles last year.
($1=78.9500 roubles)
Reporting by Reuters; Editing by Kevin Liffey – Reuters
