The Kremlin's oil revenues are growing, but the budget does not yet feel it

This week, the Donald Trump administration will extend sanctions relief on Russian oil and then may do the same for oil from Iran. Semafor writes about this with reference to ex-employees of the US Treasury and State Department.

Earlier, in March, Washington had already softened sanctions, allowing third countries to buy Russian and Iranian oil already loaded onto tankers within a month. This step was explained by the Ministry of Finance as a desire to stabilize markets against the backdrop of the war in the Persian Gulf.

However, almost a month later, experts note that there was no noticeable decline in prices - the measures only briefly reassured investors, Semafor reports. Moreover, the expansion of the circle of buyers allowed the Kremlin to receive $150 million in additional oil revenues per day.

The effect of expensive oil has not yet reached the budget. Oil and gas revenues in March, calculated based on February payments from producing companies, fell by 45% year-on-year, according to Ministry of Finance data. Compared to February, they increased, but mainly due to quarterly tax payments, and not due to increased oil revenues, The Bell noted .

The budget will feel the effect of a sharp rise in oil prices due to the war in the Middle East only by the end of April - due to revenues from the key oil tax (mineral extraction tax, severance tax). This month, revenues from the mineral extraction tax could reach $9 billion, or 700 billion rubles (twice more than in March), Reuters estimates .

However, they are unlikely to close the current budget deficit: based on the results of the first three months of the year, it is already 20% higher than the plan for the whole year.

Export revenues are growing. To calculate the mineral extraction tax, the Urals price is used. In March, it rose to $77 per barrel (the maximum since October 2023), and by the beginning of April it had already reached $115 per barrel (the maximum in 13 years).

According to Bloomberg estimates , Russia's revenue from oil exports for the week to April 5 amounted to $2.02 billion - this is the maximum since June 2022. A week earlier, the figure was $1.79 billion.

In anticipation of additional oil revenues, the Kremlin has so far abandoned the idea of ​​cutting budget spending, Bloomberg wrote . It is possible that the influx of funds, which will become noticeable in April, will allow the authorities to even increase spending on the war in Ukraine.

The war in Iran and the strikes of the Ukrainian Armed Forces. The volume of oil revenues will largely depend on how long the war in Iran lasts. Amid the two-week truce, Brent oil prices fell below $100 per barrel. If the truce continues and oil is allowed to flow through the Strait of Hormuz again, Moscow's revenues will fall.

The export of Russian oil is also affected by the Ukrainian Armed Forces’ regular attacks on the energy sector: because of them, sea exports from the Baltic ports from March 30 to April 5 decreased by a third, and shipments from Ust-Luga and Primorsk fell to their lowest level since the beginning of 2025, Kommersant wrote .