The Ministry of Finance estimated the fall in income in January at 35% with an increase in spending by 59%

By prior evaluation Ministry of Finance, the volume of revenues to the Russian budget amounted to 1.356 billion rubles. This is 35% lower than in the same period in 2022. The volume of expenses increased by 59% compared to January 2022 and amounted to 3.117 billion rubles.

Oil and gas revenues fell year-on-year by 46% and amounted to 426 billion rubles. The Ministry of Finance attributes this result to a “decrease in the representativeness” of Urals oil price quotations and a reduction in natural gas exports.

At the same time, non-oil and gas revenues decreased by 28% yoy and amounted to RUB 931 billion. The agency attributed the drop in revenues to a reduction in domestic VAT and income tax revenues.

Ministry of Finance appreciated the average cost of Urals in January at $49.48 per barrel, with the budgeted oil price of $70 per barrel. Thus, over the year, the cost of a barrel of Urals fell 1.7 times. By evaluation According to Bloomberg and Citigroup analysts, if Urals oil costs $25–35 per barrel, the CBR’s reserves in yuan will be exhausted in 2023.

According to an analyst survey Reuters, the Ministry of Finance of Russia in the period from February 7 to March 6 may allocate currency to the Central Bank in the amount of 80 billion rubles. ($1.14 billion) for sale in the domestic market. Thus, the Ministry of Finance plans to compensate for the oil and gas revenues that were not received by the budget, analysts say.

Anastasia Larina