The Russian Federation is experiencing significant economic losses due to international sanctions, which negatively impact revenues from oil and gas exports. Analysts note that the period of super profits for Russia has ended — in the medium and long term, revenues from hydrocarbons will continue to decline. It is projected that by 2026, the share of oil and gas revenues in the Russian budget will decrease to 23%, whereas it exceeded 50% in 2022.
This is reported by Finway
Reasons for the Decline in Russia’s Oil and Gas Revenues
Officially, Russia explains the decrease in revenues by the depletion of cheap hydrocarbon reserves; however, the main factors remain the war against Ukraine and strict sanctions. These restrictions forced Russia last year to sell oil and gas at the edge of profitability or even at a loss. According to Ukrainian intelligence, due to the undervalued prices of oil and petroleum products, Russia has already lost trillions of dollars.
“Moscow has already lost trillions of dollars due to the undervaluation of its oil and petroleum products.”
The international agency Argus reports that by the end of December 2025, discounts on Russian Urals oil reached $26.45-28.2 per barrel, while in November these figures were at $20.1-22.5 per barrel.
Searching for Alternative Markets and Evasion of Sanctions
Despite the sanctions, Russia is trying to maintain exports through alternative routes and markets. In particular, after a hiatus, at least three tankers carrying 2.2 million barrels of Russian oil have set sail for the Indian refinery Reliance. This became possible after the company resumed partial purchases for its own needs.
Additionally, Russia is using icebreakers to ensure the supply of liquefied natural gas (LNG) from the Arctic LNG 2 plant, which is under sanctions. Despite Western restrictions, China remains one of the main buyers of LNG from this facility.