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- Barrel sufficiency: oil is more expensive than $90 by the end of 2026 will close the budget gap
Barrel sufficiency: oil is more expensive than $90 by the end of 2026 will close the budget gap
If the Urals price remains above $90 per barrel by the end of the year, the Russian budget may reach a planned deficit of 3.8 trillion rubles, experts interviewed by Izvestia believe. By the end of April, the treasury was in the red by 5.9 trillion, the Ministry of Finance reported. However, excess oil revenues may bring an additional 2 trillion rubles in 2026. This will not allow us to reach a surplus, but it will close the gap between the planned and actual shortage. The authorities have already started replenishing the pot against the background of expensive raw materials. How long oil will be able to save the treasury is in the Izvestia article.
How much does oil bring to the budget at current prices
Even against the backdrop of the triple-digit Urals price, the budget will not be able to reach a surplus this year. However, the current windfall may help close the gap between the actual disadvantage and the plan of the Ministry of Finance, calculated Olga Belenkaya, head of the Macroeconomic Analysis Department at Finam.
The projected deficit of the Russian budget for 2026 is 3.8 trillion rubles, said the professor of the Department of Global Financial Markets and Fintech at the Russian University of Economics. Plekhanova Natalia Natocheeva. However, already in the period from January to April, the treasury went into negative territory by 5.9 trillion rubles, the Ministry of Finance reported.
In an optimistic scenario, the average annual Urals price will be at least $80 per barrel. In this case, oil and gas revenues for the year may reach about 11 trillion rubles, which is more than 2 trillion higher than planned, Olga Belenkaya estimated. To do this, a domestic barrel should cost at least $90 for the rest of the year, the analyst calculated.
In April 2026, the average Urals price for calculating taxes reached a record high of $94.87 per barrel since 2014, said Igor Rastorguev, a leading analyst at AMarkets. The price of the benchmark Brent at that time exceeded $ 120, but by the beginning of May it had fallen below $100.
At the beginning of the year, the price of domestic oil was kept at much lower values, said Ilya Fedorov, chief economist at BCS World Investments. Urals on average cost $45 in January and February, and only then $ 77 in March and $95 in April, so the average annual price is likely to be lower than the peak April values, the economist believes.
Nevertheless, with a budgeted cut-off price of $59, the excess in recent months is almost 1.6 times. For every additional $10, about 120 billion rubles per month are added to this bar at a constant exchange rate, explained Dmitry Scriabin, portfolio manager at Alfa Capital Management Company.
The cut—off price is the conditional oil price that the government sets when calculating budget revenues. If the real price of oil is lower than the cut-off price, the budget does not receive enough money and the deficit is covered from the National Welfare Fund (NWF). If the real cost of oil is higher than the cut—off price, additional income goes into the pot.
If the price remains at about $95, the budget can receive an additional 450 billion rubles per month, depending on the dynamics of the exchange rate, agreed Alexander Isakov, Senior Managing director and head of the Center for Macroeconomic Research at Sberbank.
Why the strong ruble has become a problem
However, income growth is being held back by a strong national currency: with a budgeted exchange rate of about 92 rubles per dollar, the actual level is closer to 75. The strengthening of the national currency reduces the ruble earnings of exporters, partially offsetting the effect of high dollar oil prices, Igor Rastorguev noted.
A strong currency leads to a shortage of treasury revenues by about 110 billion rubles per month relative to budget expectations, Dmitry Scriabin estimated. With this in mind, if Urals costs $95 during the year, the monthly additional income may amount to about 300 billion rubles, the expert added.
The growth of the ruble partially smooths out the budget rule, the press service of the Bank of Russia noted. The return of the Ministry of Finance to foreign currency purchases is likely to limit the further strengthening of the ruble, but will not lead to its sharp weakening, said Mikhail Vasiliev, chief analyst at Sovcombank. The high key rate and the growth of export earnings still continue to support the national currency.
From May 8 to June 4, 2026, the Ministry of Finance will begin regular purchases of foreign currency, the analyst recalled. The volume of transactions will amount to 110.3 billion rubles (5.8 billion per day) — and this amount turned out to be significantly lower than market expectations, which assumed 300-400 billion rubles, the expert added.
Even with high prices, the authorities continue to adhere to a conservative approach. Additional revenues are considered primarily as a reserve of sustainability, rather than a reason for a large-scale budget expansion, said Mikhail Nikitin, partner at 5D Consulting. According to him, oil and gas revenues today account for about 22% of treasury revenues compared to 40% a decade ago, so the financial management strategy is based on long-term scenarios, rather than short-term price spikes.
Why additional income may be lower than expected
The Ministry of Finance estimated additional oil and gas revenues in April at about 200 billion rubles, significantly less than the theoretical 400-450 billion, said Olga Gogaladze, an economist and expert on financial markets. According to the expert, there are two reasons for this. The first is just a strong ruble. The second is the fuel damper: to prevent oil companies from sharply raising gasoline prices, the state pays them compensation. In April, it could have taken 377 billion rubles, which ate up a significant part of the windfall, she said.
The fuel damper is a special government mechanism created to stabilize gasoline and diesel prices within the Russian Federation. If global prices for black gold rise, the government compensates oil companies for part of the difference between the planned fuel price and the actual price, so that they do not increase its cost within Russia. If export prices are low, companies transfer part of the profits to the budget.
In the face of rising prices, special dampers are being introduced not only for fuel, the press service of the Bank of Russia told Izvestia. For example, the rising cost of gas makes it more expensive to produce fertilizers, which leads to higher prices for agricultural products. To mitigate such impacts, the state may introduce a damper on it, the Central Bank noted.
There is a third reason for lower income from hydrocarbons — the discount of Russian oil to Brent, Igor Rastorguev added. According to the Ministry of Economic Development, in April 2026, the Urals discount was $23.94 against Brent. In addition, the growth of settlements in yuan and rupees, whose exchange rates are falling against the dollar, is squeezing ruble revenue.
In order to fully cover the current budget deficit, Urals prices must remain at extremely high levels for an extended period. This is possible only with a protracted conflict in the Middle East — more than 10 months, analysts agree.
It will be possible to close the budget deficit only if Urals reserves remain above $100 per barrel for another year, Alexander Isakov estimated.
A positive outcome from the accumulated deficit is unlikely this year, Olga Belenkaya believes. Vladimir Eremkin, a senior researcher at the IPEI Presidential Academy, agreed with her. According to him, current prices are not able to cover the deficit — they only allow us to get closer to the target.
At a price above $90, budget revenues may exceed targets by 15-20%, which will reduce the accumulated deficit, but is unlikely to bring the budget into balance, said Egor Zinoviev, an analyst at Digit Broker.
How expensive oil affects inflation and the key interest rate
Expensive oil by itself does not pose risks to inflation, however, the reasons why it is rising in price - the military conflict in the Middle East and disruption of supply routes for both energy resources and other world trade goods — can lead to an increase in world prices for a wide range of goods and services, the Central Bank noted. They added that if the conflict drags on, global inflation may spread to Russia.
The increase in the tax price of oil is considered a moderately inflationary factor, as it increases budget momentum and consumer demand, emphasized Egor Zinoviev. However, part of the effect is offset by the strengthening of the ruble and mechanisms for regulating domestic fuel prices. Therefore, the expert predicts a smooth easing of monetary policy. In his opinion, the key rate will be up to 12% by the end of the year.
Nevertheless, the Bank of Russia will continue to remain cautious due to the risks of imported inflation and geopolitical uncertainty, so the key rate reduction will be slower than market expectations, Olga Belenkaya believes.
For a stable budget balancing, it is necessary that the Urals price stays above $100 for a long time, which is possible only with a prolonged external shock. The conflict in the Middle East adds uncertainty, so fiscal policy remains conservative: windfalls are accumulating, and the deficit in 2026 is likely to persist.
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