Russia's oil and gas revenue has dropped sharply, what is the main reason? President Putin revealed something temporary

On January 11, Oil Price cited data from the Russian Ministry of Finance saying that Russia's oil and gas revenue in 2023 decreased by nearly 24%.

Doanh thu dầu khí Nga giảm mạnh, nguyên nhân chính là gì? Tổng thống Putin tiết lộ một điều mang tính chất tạm thời

Russia's oil and gas revenue to fall 24% in 2023. (Source: CNBC)

Specifically, revenue from these two items will reach 99.3 billion USD (8,822 billion Rubles) in 2023, down 23.9% compared to 2022.

Lower oil prices in 2023, Russia's Urals oil falling to lows in 2023 along with falling gas export prices are the main reasons for Russia's weak energy revenues.

Earlier this week, the Russian Finance Ministry said the average price for Urals oil in 2023 would be $62.99 a barrel, down from an average of $76.09 a barrel in 2022.

This price is also higher than the ceiling price that the Group of Seven (G7) and the European Union (EU) imposed sanctions on Russian crude oil exported by sea to third parties using insurance and transportation services provided by Western companies.

Gas exports by pipeline to Europe in 2023 will decrease by 55.6% compared to 2022, which will also affect Russia's budget revenues. At the end of 2022, the Nord Stream pipeline exploded, affecting exports.

In 2023, Russia will also stop supplying gas to some European countries. The amount of gas exported to Europe by pipeline in 2023 will only reach an average of 77.7 million m3/day, a sharp decrease compared to 174.8 million m3/day in 2023.

Previously, at the end of 2023, answering Rossiya 24 channel, Russian Deputy Prime Minister Alexander Novak revealed that the amount of money Moscow earned from oil and gas exports was 100 billion USD this year, almost equal to the revenue recorded in 2021.

More than half of Russia's total export revenue comes from the energy sector, underscoring that oil and gas sales continue to provide stable income for the country's budget.

According to Mr. Novak, Russia's energy sector contributes "about 27% to the Gross Domestic Product (GDP)", and oil and gas revenues account for "almost 57% of the country's total export revenue".

* Also on January 11, speaking at a meeting with Far Eastern businessmen, Russian President Vladimir Putin affirmed that the current basic interest rate of the Russian Central Bank of 16% is only temporary and will change when inflation is controlled.

"The current key interest rate of the Russian Central Bank is temporary in nature. When the problems related to inflation are resolved, the situation will change," Putin said.

Russia's central bank has more than doubled its key interest rate in 2023 - from 7.5% to 16%.

At its most recent meeting in December 2023, Central Bank Governor Elvira Nabiullina said the rate-hike cycle was coming to an end.

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