Oil and Gas Dramatic Decline: the rf’s Budget Has Lost Nearly $17 Billion

In January–July 2025, russia’s federal budget revenues from the oil and gas sector decreased by 19 % compared to the same period last year, to $69.2 billion. The main reasons were the falling oil prices, the strengthening of the ruble, and a sharp decline in gas exports to the EU.

The average price of Urals crude oil decreased by 18.4 % to $60.37 for a barrel. At the same time, the ruble has strengthened by 45 % since the beginning of the year, from 113.71 to 81.25 for 1 US dollar. Gas supplies to the EU decreased by 50 % to 9.93 billion m³.

In response to the decline in revenues, the government of the rf is reducing compensation to oil companies within the framework of the fuel damper. The Ministry of Finance has revised its forecast for oil and gas revenues for 2025 to $104.4 billion, which is by 24 % less than previous expectations ($137.3 billion).

The decline in energy revenues underscores the russian economy’s growing vulnerability to external pressure. To compensate for the shortfall, the government plans to more actively use the National Welfare Fund and cut budget items to finance the war against Ukraine.