Russia’s Revenue Jumps in First Quarter Amid Rising Oil Prices
Russia has reported a significant increase in revenue in the first quarter of 2024, with a 53.5% rise compared to the same period last year. The country’s Finance Ministry attributed this growth to one-time tax payments and the surge in oil prices.
According to the Finance Ministry, revenues for the first three months of the year amounted to 8.7 trillion rubles, with inflows from non-energy industries increasing by 43% year-on-year. The ministry stated that these non-energy sectors provide a stable basis for further income growth.
Oil and gas revenue saw a rapid increase of almost 80% compared to last year, driven by rising oil prices and a one-time tax payment from oil companies. Brent crude oil is currently trading above $90 a barrel, up almost 20% since the beginning of the year due to geopolitical tensions and supply shocks.
Despite the growth in revenue, Russia has been facing budget deficits since the end of 2022, largely due to the costs of President Vladimir Putin’s invasion of Ukraine. However, the deficit at the end of the first quarter of 2024 was 1.5 trillion rubles smaller than at the same time last year.
The European Union’s ban on most seaborne imports of crude and petroleum products from Russia, as well as price caps imposed by the Group of Seven nations, have impacted energy income. However, the Finance Ministry remains optimistic about the overall income growth, especially in non-energy sectors.
Economists, such as Sofya Donets from Renaissance Capital, have noted the strong performance of non-oil-and-gas sectors, which have exceeded expectations. Despite the challenges posed by sanctions and geopolitical tensions, Russia’s economy continues to show resilience and growth in revenue.
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