Data from the Russian Ministry of Finance showed that oil and gas revenues plummeted by 35% year-on-year in May to 512.7 billion rubles ($6.55 billion), as falling oil prices and sanctions weighed on the country’s economy.
Russia requires higher oil prices to balance its budget and finance its military operation in Ukraine.
Sources familiar with the talks told Reuters on Wednesday that Russia opposed the recent oil production increases approved by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+.
Oil and gas revenues are the Kremlin’s most important source of cash, accounting for between a quarter and half of total federal budget revenues over the past decade.
The Ministry of Finance stated that revenues in May dropped to 512.7 billion rubles ($6.55 billion), which is 35% lower than the same month last year.
Revenues also declined by 53% from April due to the drop in global oil prices and the strengthening of the ruble. Reuters had forecast revenues at 520 billion rubles.
The Finance Ministry also said it expects oil and gas revenues in June to be 40.3 billion rubles less than planned.
The decline in oil prices has dealt a blow to Russia, which recorded a budget deficit of 3.2 trillion rubles, or 1.5% of GDP, in the first four months of the year.
The Russian Ministry of Finance also raised its 2025 budget deficit forecast to 1.7% of GDP from 0.5% after cutting its energy revenue projections by 24% due to expectations of a prolonged period of low oil prices.
Finance Ministry data released Wednesday showed that oil and gas revenues in the budget fell by 14.4% in the January–May period compared to the same period last year, amounting to 4.24 trillion rubles
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