Turning point: what benefits Russia from the Middle East crisis
The crisis in the Middle East has brought Russia windfall revenues to the budget. So far, most forecasts assume consistently expensive oil — at least until the end of the year. This promises increased oil and gas revenues for Russia. However, the market situation is changing rapidly: short-term growth is giving way to serious risks, and this, according to the Ministry of Finance, should be reflected in the budget rule. Izvestia found out how the mechanism can be adjusted.
A sharp jump
The decrease in supplies through the Strait of Hormuz triggered an oil rally: Brent has risen by almost 50% since the conflict began in late February. Russian export varieties have also risen in price.
According to the Ministry of Economic Development, the average price of the main Russian Urals grade from March 15 to April 14 was $684.9 per ton, or about $94 per barrel.
In early April, the Urals price generally reached a 13—year high of $116 per barrel. In other words, the cost of oil supplied abroad from Russia was almost twice the average level of $59 per barrel included in the Russian budget for the current year.
Unsurprisingly, Russia's oil export revenues jumped to $19.04 billion in March, the International Energy Agency (IEA) reported. This is 9.7 billion more than in February and 4.76 billion more than a year earlier.
Even more expensive
The conflict in the Persian Gulf is dragging on, so estimates of the dynamics of future oil prices are growing.
So, in its April report, Goldman Sachs investment bank announced an updated forecast: the average price of Brent crude oil in the fourth quarter will be $ 90 per barrel. This is significantly higher than the bank's previous forecast ($80).
This is almost $ 30 more than before the closure of Hormuz, the bank's analysts said, noting that the prolonged closure of the strait leads to an "extreme" reduction in reserves.
According to Goldman Sachs estimates, the reduction in oil production in the Persian Gulf by 14.5 million barrels per day led to the fact that global oil reserves decreased at a record pace in April — by 11-12 million barrels daily.
Precarious situation
Nevertheless, the trend of consistently high oil and gas revenues in Russia until the end of 2026 remains ambiguous.
So, according to Reuters estimates, in May 2026, revenues will reach about 650 billion rubles, an increase of 27% compared to May last year, when they amounted to 512.7 billion rubles.
However, the picture for the first five months of 2026 looks different. From January to May, oil and gas revenues, according to preliminary estimates, will exceed 2.94 trillion rubles, but they will not reach last year's figure of 3.16 trillion rubles.
The lag is due to the "failure" at the beginning of the year. So, in February, they reached a minimum since 2022 ($ 9.5 billion) due to sanctions and attacks on the Russian energy infrastructure.
"In the first quarter, oil and gas budget revenues amounted to 1.443 trillion rubles and were 45.4% lower year—on-year due to the previous low Urals price and the strong ruble,— says Vladimir Chernov, analyst at Freedom Finance Global.
The effect of the March and April increases in oil prices should be more pronounced in the budget with a time lag starting in April and May, he believes.
Ultimately, the horizon for maintaining higher incomes depends on the duration of the crisis in the Middle East. According to some estimates, for example, the Energy Information Administration of the US Department of Energy, Brent is able to roll back to $ 51 per barrel as soon as the situation normalizes.
Budget rule
So far, the forecast price for Urals in the medium term remains around $ 85-100 per barrel. This range is relevant if Brent prices remain around $90-105, and here Goldman Sachs' forecast indicates that the price environment remains strong.
With the dollar exchange rate of 75 rubles and Urals in the range of 85-100 dollars per barrel, oil and gas revenues for 2026 may amount to about 8.5–9.2 trillion rubles. That is, the budget plan remains achievable, emphasizes Vladimir Chernov.
Thus, Russian grades, primarily Urals, will remain expensive in the coming months relative to the budget cut-off price of $59 per barrel.
According to the budget rule, when the oil price is above the threshold, the Ministry of Finance directs the surplus to the National Welfare Fund (NWF).
In 2025, it was decided to gradually reduce the cut—off price in the budget rule from 60 to 55 dollars per barrel by 2030, in increments of 1 US dollar per year. However, now the Ministry of Finance is talking about the need to revise the rules for the formation of the "cut-off price".
As noted by Finance Minister Anton Siluanov, reducing the cut-off price in the budget rule at such a pace is no longer relevant, it is necessary to adjust this scheme. The revision of the rules is planned from 2027.
To current parameters
The main reason for the urgency of abandoning the previous scheme is the discrepancy between the rapidly changing market conditions.
— The general logic is to link the cut-off price to more relevant market parameters. It is necessary to focus on average prices over a shorter period or on projected prices from reputable analytical agencies. We also need a dynamic adjustment: the introduction of mechanisms that allow us to more quickly review the cut—off price in case of significant changes in the market," explains Sergey Tolkachev, professor at the Financial University under the Government of the Russian Federation.
It is possible that the cut-off price will not be formed according to one variable, but will take into account several factors reflecting a more complex market situation, the economist adds.
Freedom Finance Global also believes that starting in 2027, it will be about a more flexible formula.
— The new price should take into account not only the old goal of reducing budget dependence on oil exports, but also the medium-term level of prices for hydrocarbons. At the same time, the Ministry of Finance will try not to budget current prices at their peak. For the budget, this will give a more realistic calculation of oil and gas revenues, but it will not cancel the accumulation of part of the excess profits," says Chernov.
Thus, the task is to find a new formula that would allow, on the one hand, not to exhaust reserves at low prices, and on the other hand, not to deprive the budget of resources at high prices.
Переведено сервисом «Яндекс Переводчик»
