The federal budget received 393.3 billion roubles in oil and gas revenues (OGR) in January, falling short by 17.4 billion roubles from the planned amount, according to a statement released on the Finance Ministry's website on 4 February. This figure represents a 50% decline compared to January last year, when OGR amounted to 789.1 billion roubles, and a decrease of 12.1% compared to December 2025 (447.8 billion roubles). Furthermore, January's oil and gas revenues marked the lowest result in the past five and a half years, with the last comparable figure occurring in July 2020 at 340 billion roubles. In February, the ministry forecasts a further drop in additional OGR by 209.4 billion roubles. From 6 February to 5 March, the Finance Ministry plans to sell a cumulative total of 226.8 billion roubles (11.9 billion roubles daily) in foreign currency and gold, as indicated by the statement.
According to data from the Ministry of Economic Development, the average monthly price of Urals crude oil in January was $40.95 per barrel. Throughout the previous year, this price consistently declined, dropping from $67.66 per barrel in January to $39.10 per barrel in December. A slight increase was observed in June and July ($59.84 and $60.37 per barrel, respectively), but the negative trend resumed thereafter. According to the Ministry's September forecast, the average annual price of Urals crude is expected to reach $59 per barrel this year.
However, experts believe that the ministry's expectations may be somewhat overestimated, as reported by Vedomosti on 2 February. The average annual price of Urals crude could settle around $50 per barrel due to persistently low global prices (with the average price of Brent crude projected at around $60–63 per barrel) alongside a reduction in the discounts on Russian export oil prices to levels observed at the start of 2025—between $8 and $10, analysts at ACRA mentioned in their macroeconomic forecast. Consequently, the federal budget could potentially lose 0.5–0.7% of GDP in revenues compared to the current plan, with the budget deficit reaching 2.2–2.7% of GDP (the Finance Ministry's plan for this year anticipates a deficit of 1.6% of GDP). A recent macroeconomic survey by the Bank of Russia corroborates ACRA's findings—respondents expect the average annual price of Urals crude to be around $50 per barrel (the figure was $54 per barrel in December).
From this year, the breakeven price for oil based on the budget rule will gradually decrease by $1 annually and is expected to reach $55 per barrel by 2030. Finance Minister Anton Siluanov mentioned in September that the previous threshold of $60 per barrel was no longer "responsive to the realities of the time." Under the budget rule, the additional revenues from oil prices exceeding the established threshold are allocated for purchasing foreign currency and gold for subsequent accumulation in the National Welfare Fund (NWF). However, if revenues fall below the planned amount, sales will be conducted to cover the shortfall.
Vedomosti has submitted an inquiry to the Finance Ministry.
The consistent reduction in the share of oil and gas revenues reflects deeper structural changes within the economy and the country’s budgetary system, notes Elena Lebedinskaya, Director of the Finance Ministry’s Revenue Department (her remarks were published by the ministry's press service on 4 February). "As a result, the federal budget is becoming less sensitive to fluctuations in global commodity prices than it was ten years ago, thereby enhancing its resilience amidst external instability," she concluded. According to the federal budget law for 2026–2028, OGR for the current year is expected to total 8.9 trillion roubles (or 22% of all planned budget revenues).
Reasons for the Decline
The dynamics of oil prices, which depend on international benchmarks and discounts on Russian oil, are crucial for OGR, states Sergey Tereshkin, General Director of Open Oil Market. At the end of the previous year, the Urals discount to Brent exceeded $20 per barrel, which contributed to January's figure being the lowest in the last five and a half years, he notes. A key factor for the increased discount has been the tightening of US sanctions against Russian oil companies, which has heightened risks for importers of Russian oil, the expert explains.
However, the market gradually acclimatises to new restrictions, Tereshkin believes. For example, at the beginning of 2023, shortly after the EU embargo on Russian oil imports came into effect, the Urals discount to Brent prices surpassed $25 per barrel but then gradually returned to around $10–12 per barrel. In the expert's opinion, a similar scenario will unfold this year, provided that the US does not impose new restrictions. Overall, 2026 could prove to be even more challenging for oil and gas revenues than the previous year, according to Tereshkin. A high discount could be counterbalanced by an increase in domestic oil production and exports; however, OPEC+ is unlikely to make drastic moves while Brent prices remain close to the $60 per barrel mark, he adds.
The decline in oil prices and a high discount on Urals oil, reaching approximately $25 per barrel, are negatively impacting the financial performance of Russian oil companies, agrees Sergey Suverov, Investment Strategist at Aricapital. The situation is particularly tough for smaller companies that face high production and export costs, he notes. Larger companies with lower production costs are faring better through this "perfect storm." Suverov believes that the situation regarding oil and gas revenues should improve slightly in February, with Brent prices rising to $70 per barrel, while the rouble's exchange rate may soon trend downwards. According to Rosstat data from the first ten months of the previous year, the share of loss-making organisations among oil and gas production enterprises has slightly decreased to 47.5% after reaching 48.1% in January–September.
The impact on oil and gas revenues stems from a combination of several factors: widening spreads, unstable oil and gas export flows (with China being the only major buyer with predictable demand), attacks on shipping, as well as a negative long-term market outlook amidst an exceptionally strong rouble, notes economist and author of the Telegram channel Spydell Finance, Pavel Ryabov.
Under current circumstances, oil and gas revenues are expected to total no more than 6 trillion roubles by the end of the year, compared to a forecast of 9 trillion roubles, with the strongest blow coming from the over-appreciated rouble.
Source:
Vedomosti
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