Oil, gas revenue collapse deepens Russia’s budget crisis

Russia’s oil and gas revenues continued their steep decline in 2025, falling by 18.5% in the first seven months of the year compared to the same period in 2024, Russian Finance Ministry confirmed.

Between January and July 2025, oil and gas revenues totaled 5.522 trillion rubles ($58.13 billion), reflecting a deepening contraction in one of the Kremlin’s most vital sources of income, Caliber.Az reports per Russian media.

The figures illustrate a clear pattern of accelerating decline: revenue dropped by 3.7% in the first two months, by 10.3% over four months, and by 14.4% through May—culminating in a sharp 27% year-on-year fall in July alone.

In monetary terms, July’s revenues from oil and gas amounted to just 787 billion rubles ($9.86 billion), highlighting the scale of the monthly drop. Simultaneously, budget receipts from the mineral extraction tax (MET) on crude oil and gas condensate fell by an even steeper 34.3%, reaching 885.2 billion rubles ($11.08 billion).

The downturn in hydrocarbon income comes at a critical time for the Russian government, which recently revised its fiscal targets in response to growing budgetary stress. Amendments approved in June increased the projected federal budget deficit for 2025 from 1.173 trillion rubles ($14.67 billion) to 3.792 trillion rubles ($47.43 billion)—more than tripling the initial estimate.

To reflect the deteriorating revenue outlook, the government also slashed its forecast for total oil and gas earnings in 2025 by 2.6 trillion rubles ($32.52 billion), lowering expectations from 10.9 trillion rubles ($136.3 billion) to 8.317 trillion ($104.03 billion).

By Vafa Guliyeva