Russia's Oil and Gas Tax Revenues to Increase in May but Lag Year-to-Date
Analysis of Russia's Oil and Gas Tax Revenue Trends
May 2026 Revenue Projections
MOSCOW, April 27 (Reuters) - Russia's oil and gas revenues from taxes, key proceeds of the federal budget, are likely to increase in May thanks to higher oil prices bolstered by the Iran war, but will be lower than last year for the first five months of 2026, Reuters calculations showed.
Russia's oil and gas tax revenue will reach around 650 billion roubles ($8.65 billion) in May, according to Reuters calculations, based on preliminary production data and oil prices.
That would be up from 512.7 billion roubles in the same month in 2025.
Impact of Geopolitical Events
Russia has been one of the beneficiaries of the conflict in the Middle East, which has led to the effective closure of the Strait of Hormuz, the main transport route for about a fifth of world oil supplies and other vital goods including fertilisers.
Constraints on Revenue Growth
However, Ukrainian drone attacks on Russia's energy infrastructure have capped Moscow's crude production, the world's third largest after the United States and Saudi Arabia.
There are limits on the windfall for Russia, and economists inside the country have repeatedly cautioned that 2026 could be a tough year.
Year-to-Date Performance and Contributing Factors
Comparison with Previous Year
Reuters calculations also showed that Russia's January-May budget proceeds from the sales of oil and natural gas will likely reach more than 2.94 trillion roubles, but down from 3.16 trillion generated in the same period of 2025.
Reasons for the Decline
The decline is due to a fall in the first three months of this year, before the U.S. and Israel attacked Iran, when oil prices were lower. A stronger rouble has also undermined the revenue.
Budget Deficit Overview
Russia ran a budget deficit of 4.58 trillion roubles, or 1.9% of gross domestic product, in January-March 2026, according to the finance ministry.
($1 = 75.1500 roubles)
(Reporting by Reuters; Editing by Susan Fenton)
