Russia’s revenues from its oil and gas industry, vital to financing its war in Ukraine, dropped to a five-year low in 2025 as crude prices slumped and gas exports declined.
The nation’s budget received a total of 8.48 trillion rubles ($108 billion) in oil and gas taxes last year, Finance Ministry said on Thursday. That’s 24 percent less than in 2024 and the lowest level since the start of the decade, historic figures show.
Russia, a top-three global oil producer and home to the world’s largest gas reserves, heavily relies on tax revenues from the two industries to fill its state coffers. The decline, mainly driven by a combination of weaker global oil prices, stronger ruble and energy sanctions against Russia, comes as the Kremlin has boosted military spending significantly above what it planned to fund the war, which is about to enter a fifth year.
To bridge the widening gap between revenues and spending, the government in Moscow has eaten into more than half of the country’s National Wellbeing Fund – a buffer against economic shocks – and turned to expensive borrowings that will take years to pay back.
Oil revenues dropped more than 22 percent year on year to 7.13 trillion rubles, reaching the lowest level since 2023, Bloomberg calculations show. Concerns about an oversupply in the global crude market, and discounts for Russian barrels in particular due to western sanctions, hit the flow of money into state coffers.
The official data show that the average price of Urals, Russia’s main oil-export blend, for tax purposes was $57.65 a barrel in 2025, a 15 percent drop from a year earlier.
Starting from November, when the US blacklisted two major oil producers Rosneft PJSC and Lukoil PJSC, the discount of Urals to the Brent benchmark widened to about $27 a barrel at the point of export, as buyers needed financial incentives to continue purchases.
A stronger ruble also contributed to the lower revenues in domestic-currency terms. Last year, the ruble traded at an average of 85.67 per dollar, or 6.4 percent more than in 2024, according to Bloomberg calculations based on data from Russian authorities.
The combination of weaker Urals and a stronger ruble meant that last year the Russian budget received fewer rubles for each produced-and-sold barrel.
Russia’s taxes from the gas industry fell more than 30 percent to 1.35 trillion rubles, the figures show. That’s the lowest level since the pandemic year of 2020, according to historic data.
Russia, once the single-largest exporter of natural gas to Europe, since the start of the war in Ukraine has gradually lost nearly all of its clients in the region.
From January 2025, the flow of Russian gas to Europe via Ukraine stopped as the transit deal expired, leaving Gazprom PJSC with fewer west-bound export routes. While Russia has been ramping up its natural-gas exports to China instead, the deliveries cannot fully replace the European market.
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