Russia’s income from oil and gas is expected to drop by 46% this January

Significant Decline in Russia’s Oil and Gas Revenue

Russia is expected to see its oil and gas budget income fall by 46% this January compared to the same period last year. These figures are based on current production levels, refining activity, and both domestic and international sales data.

For January, Russia’s oil and gas earnings are projected to reach 420 billion rubles, or roughly $5.42 billion. This decrease is largely attributed to weaker global oil prices and a stronger ruble. In December 2025, the ruble appreciated by over 30% year-on-year, which led to a 53% drop in the ruble-based oil price used for tax calculations.

The oil and gas sector typically accounts for about a quarter of Russia’s total government revenue. Western governments have targeted this segment with sanctions, aiming to limit Russia’s ability to finance its military actions in Ukraine. Despite 19 rounds of EU sanctions and multiple U.S. measures, these efforts have not altered Russia’s military strategy. Notably, the EU continues to import Russian oil and gas, often through intermediaries, even as it maintains sanctions.

Reuters also highlighted that, based on current price forecasts, Russia’s federal budget is set to receive approximately $120 billion (8.96 trillion rubles) in oil and gas revenue this year. This marks an increase from last year’s 8.48 trillion rubles (about $110 billion), which itself was a 24% drop from the year before.

The downward trend has continued, especially after the U.S. imposed new sanctions in November targeting Russia’s two largest crude exporters and their customers. Consequently, Indian buyers of Rosneft and Lukoil have shifted to other suppliers and trading firms. Nevertheless, the reduction in Russian oil shipments to India has not been as steep as anticipated, with December volumes exceeding 1 million barrels per day, surpassing the expected 800,000 barrels per day.

By Irina Slav for Oilprice.com