Russia’s Oil, Gas Revenues Drop 27% amid Lower Prices, Stronger Ruble

Russia’s oil and gas revenues fell sharply in October, dropping by nearly 27% year-on-year to 888.6 billion rubles ($10.93 billion) as global crude prices weakened and the ruble appreciated, according to data released Thursday by the Russian Ministry of Finance.

Despite the annual decline, revenues were up 53% compared to September, reflecting periodic profit-based tax payments by energy companies that temporarily boosted monthly inflows.

Oil and gas earnings account for roughly one-quarter of Russia’s federal budget, providing a critical source of funding for Moscow’s ongoing military campaign in Ukraine, now entering its fourth year.

The ministry’s data showed that total budget revenues between January and October dropped 21.4% from a year earlier to 7.5 trillion rubles, aligning with the government’s latest annual forecasts.

Initially, the Finance Ministry had projected 2025 oil and gas revenues at 10.94 trillion rubles, or about 5% of GDP, but later revised that figure down to 8.32 trillion rubles amid market headwinds and currency volatility.

By comparison, Russia’s 2024 oil and gas revenues reached 11.13 trillion rubles, underscoring the fiscal impact of declining export prices and the stronger ruble, which reduces the value of foreign currency earnings when converted into domestic terms.

Analysts say that while Moscow continues to redirect energy exports toward Asia to offset Western sanctions, the dual pressure of lower oil benchmarks and currency appreciation is straining state finances. The situation could force the Kremlin to reconsider spending priorities as it seeks to maintain both military funding and domestic stability.