Russian Oil Has Gone Into A Steep Dive

The average Urals price amounted to $48.92 per barrel.

The price of Russian oil has fallen to its lowest level in two years, breaking through the psychologically important mark of 4,000 rubles per barrel. That's more than 40 percent lower than budgeted, Reuters reports (translated by Charter97.org).

The average cost of Russia's Urals and ESPO oil blend averaged $48.92, or 3,987 rubles per barrel, on May 2. Not only is this the minimum since May 2023, but it is far below even the Finance Ministry's recently adjusted forecast of 5,281 rubles per barrel. Initially, the government was counting on 6,726 rubles.

The price collapse occurred amid expectations of an oversupply of oil and the decision of OPEC+, including Russia, to accelerate the increase in production. Additional pressure came from statements by US President Donald Trump, when he said Moscow and Kiev wanted peace, and Putin began to lean toward negotiations after oil prices fell.

The Kremlin has been dealt a painful blow: the energy sector provides a third of all federal budget revenues. Just last week, the government lowered its forecast for oil and gas revenues by 24% and increased its forecast for the 2025 budget deficit from 0.5% to 1.7% of GDP.

With unprecedented military spending (6.3% of GDP), analysts predict that it will be impossible to balance the treasury without raising taxes and borrowing.

You can support the website Charter97.org

MULTI-CURRENCY ACCOUNT FOR ASSISTANCE:

Bank's name: Bank Millennium S.A.
Address: ul. Stanislawa Zaryna, 2A, 02-593, Warszawa
IBAN: PL97116022020000000216711123
SWIFT: BIGBPLPW
Name of the account holder: Fundacja “KARTA ‘97”
Purpose/title of payment: Donation for statuary aims

You can contact us by the e-mail charter97@gmail.com