(Moscow) – The Russian government has approved a drastic revision to its 2025 state budget, with the projected deficit surging more than three times higher than originally planned. The shortfall will now reach 3.8 trillion rubles, or approximately £33.1 billion, up from the initial estimate of 1.17 trillion rubles, or around £10.2 billion.
The dramatic increase has been attributed to plummeting revenues from oil and gas exports, long considered the backbone of Russia’s economy. According to Vladyslav Vlasiuk, adviser to the Office of the President of Ukraine and Commissioner for Sanctions Policy, the decline is primarily due to two factors: falling global oil prices and a stronger ruble. These changes, heavily influenced by international sanctions, have reduced Russian oil and gas earnings by nearly one quarter, stripping the Kremlin of an estimated 2.6 trillion rubles, or roughly £22.6 billion.
The revised economic forecast now places the average price of Russian Urals crude oil at just 56 US dollars (£43.90) per barrel, down from the earlier projection of 69.70 US dollars (£54.70).
Vlasiuk stated that sanctions remain a key force driving this decline in energy revenues. He noted that Russia is still critically reliant on petrodollars to sustain its economy and fund its ongoing war against Ukraine.
The European Commission has confirmed ongoing discussions within the G7 to lower the price ceiling on Russian oil exports, which currently stands at 60 US dollars (£47) per barrel. A further cut is likely, with strong backing from multiple Western allies.
These fiscal cracks are appearing at a time when Russia’s largest state owned shipping group, Sovcomflot, recently reported losses nearing 400 million US dollars (£314 million), underlining the pressure sanctions have placed on Russian logistics and energy trade.
