Russia’s oil and gas revenues are projected to fall by one-third in May 2025 compared to the same month in 2024, marking the lowest monthly revenue since July 2023. This decline is attributed to lower oil prices and a stronger rouble, according to Reuters calculations.
The projected revenue for May stands at 0.52 trillion roubles ($6.48 billion), a significant drop from previous months. In April, revenues were bolstered by an additional quarterly oil tax payment, making the May figures even more stark in comparison. Between January and May, total oil and gas revenue may decline 14% year-on-year to 4.25 trillion roubles.
The Russian finance ministry has revised its 2025 oil and gas revenue forecast downward to 8.32 trillion roubles, or 3.7% of GDP, from a previous 10.94 trillion roubles (5.1% of GDP). This adjustment comes amid ongoing elevated defence and security outlays tied to its military campaign in Ukraine. Additionally, the government has increased spending by 830 billion roubles to address these needs.
The decline in oil and gas revenues poses challenges for Russia’s federal budget, as these sectors make up roughly a quarter of its income. The drop in revenue is primarily due to the strengthening of the rouble and lower oil prices in global markets. The oil price in rouble terms dropped significantly in April to 4,562 per barrel from 6,965 the previous year.
The official figures for May’s oil and gas revenues are expected to be released on June 4. Analysts and policymakers will be closely monitoring these numbers to assess the impact on Russia’s economy and budget planning.
