The price of Russian oil in rubles fell below 4,000 per barrel: this is a two-year minimum and 40% less than the level provided for in the Russian state budget. About this informs Reuters.
Currently, the average price of Russian Urals and ESPO grades is 48.92 dollars per barrel, which is equal to about 3.9 thousand. rubles This is significantly lower than the planned budget figure of 6.7 thousand. rubles per barrel, as well as the government’s adjusted forecast of 5,281 rubles, which is used to calculate tax revenues.
Despite falling revenues, the Russian government has already approved a 25% increase in military spending for 2025, to 6.3% of GDP — the largest share since the end of the Cold War. The full-scale war against Ukraine continues for the fourth year. Many economists predict that the government will have to raise taxes, cut social spending and borrow more to keep up with defense spending cuts.
The decline in oil prices is due to expectations of a surplus on the world market. Over the past six trading days, the quotation has lost more than 10%, and since April – more than 20%. One of the reasons was concern about a global slowdown caused by US President Donald Trump’s announcements about the possible introduction of new trade tariffs.
The decision of the OPEC+ countries, including Russia, to accelerate production growth is putting additional pressure on the market. Energy supplies remain the source of about a third of Russia’s budget revenues. Last week, the Russian government revised its forecast for 2025: the expected budget deficit was increased from 0.5% to 1.7% of GDP due to an expected 24% drop in energy revenues amid a prolonged period of low oil prices.
