Falling oil prices put Russia at risk of rising budget deficit — UK intel

The UK Defense Ministry reported the information.

As noted by UK intelligence, due to worsening price expectations, Russia’s Ministry of Finance has lowered its projected oil and gas revenues by 25%, from 10.94 trillion to 8.32 trillion rubles (from $135 billion to $103 billion).

At the same time, the expected budget deficit has tripled — from 0.5% to 1.7% of GDP.

Despite this, intelligence analysts write, Russia continues to prioritize high military spending at the expense of economic stability.

In particular, they noted that Russian authorities have increased projected government expenditures for 2025 by another 830 billion rubles (about $10.2 billion).

According to British intelligence, if oil prices remain low, Moscow will likely be forced to further draw on financial reserves to support government spending.

• On April 28, Hennadiy Ryabtsev, an energy expert and head of special projects at the Scientific-Technical Center Psychea, stated that oil-exporting countries are currently competing by increasing production and cutting prices per barrel, which spells bad news for Russia.
• On May 7, Volodymyr Omelchenko, Director of Energy Programs at the Razumkov Center, said that currently the price of Russian Urals crude oil is slightly higher than $50.