The combined net profits of Russia’s oil and gas companies nearly halved in the first quarter from a year earlier, while petroleum revenues for the budget have been falling with the decline in oil prices in recent months.
The net profits of the Russian oil and gas firms slumped to $9.9 billion (789.5 billion Russian rubles) in the first quarter of 2025, down from $18 billion (1.445 trillion rubles) for the same period of 2024, according to data from Russia’s statistics agency Rosstat cited by The Moscow Times.
The drop in oil prices, the tightening of Western sanctions, and the stronger Russian ruble have combined to weigh on company profitability.
Every third ruble going into Russia’s budget comes from the oil and gas companies.
The decline in oil prices in recent weeks has reduced Russia’s revenues from oil and gas.
Russia said at the end of April it expects 24% lower revenues from oil and gas this year compared to earlier estimates, following the oil price crash that began in early April and sank the price of its flagship Urals crude close to the $50 per barrel mark.
The value of Russian crude oil exports sank in May to the lowest level in over two years.
The volume of Russian crude oil exports in the four weeks to May 25 barely changed from the previous four weeks to May 18, but the value of the shipments dropped to the lowest level since April 2023, according to data reported by Bloomberg’s Julian Lee.
Russia’s revenues started to decline significantly in April with the crash in oil prices.
In May, oil and gas revenue for Russia’s budget totaled $6.5 billion (512.7 billion rubles), a plunge of over 35% compared to the same month of 2024. The revenue was the lowest since June 2023, according to Bloomberg calculations.
By Charles Kennedy for Oilprice.com
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