Reuters: Russian oil and gas revenues set to rise by 50% in June

11:51 01.07.2024 •

Russia's oil and gas revenue in June is set to rise by more than 50% year on year to $9.4 billion, Reuters calculations showed, after a decrease in subsidies to refineries and reflecting the Russian economy's ability to limit the impact of sanctions.

These revenues have been the most important single source of cash for the Kremlin, accounting for around a third to a half of total federal budget proceedings for the last decade.

The military conflict in Ukraine has prompted the West to impose multiple sanctions aimed at curbing Russian oil and gas income that accounts for about a third of the country's federal budget.

Russia was able to divert oil exports away from Europe to India and China, securing the much-needed financial flows for its budget, which is in deficit as Moscow spends heavily on defence and security.

Reuters calculations show Russia's projected June oil and gas revenue at 814 billion roubles ($9.4 billion), up from 794 billion roubles in May and 529 billion roubles in June 2023.

The Finance Ministry will publish June's budget data on July 3.

For 2024 as a whole, the government budgeted for federal revenue of 10.7 trillion roubles from oil and gas sales, up 21% from 2023, when weaker oil prices and a fall in gas exports reduced the revenue by 24%.

Russia has heavily increased defence and security spending since launching what it calls a special military operation in Ukraine in February 2022, leading to two consecutive annual deficits exceeding 3 trillion roubles, about 2% of GDP.

It financed these with internal borrowing and by drawing National Wealth Fund (NWF).

Russian President Vladimir Putin has hailed high rates of economic growth, saying they outstrip that of Western economies.

The economy grew 3.6% in 2023 after a revised 1.2% contraction in 2022.


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