The Kremlin is taking measures to mitigate the impact of a global oil price slump on Russia’s economy, as its key oil grade nears $50 per barrel for the first time in 21 months. Kremlin spokesman Dmitri Peskov described the situation as volatile and tense, with efforts focused on minimizing the economic consequences.
Oil and gas account for nearly 30% of Russia’s federal budget, and a decline in oil revenues could strain the nation’s finances, especially as spending has increased due to the war in Ukraine.
Russia’s Urals oil grade dropped to $52.76 per barrel at Primorsk, its lowest since June 2023. Kremlin spokesman Peskov attributed the decline to U.S. tariffs. Russia, leading OPEC+ with Saudi Arabia, is monitoring the situation closely. The Finance Ministry recently adjusted its 2025 oil price forecast to $60 per barrel, down from the expected $70, predicting a budget deficit increase of no more than 1% of GDP.
Global oil prices have plummeted following the broad tariffs imposed by the U.S. on its trading partners last week, creating uncertainty over global demand. Additionally, the OPEC+ group is set to increase production next month, and Saudi Arabia has reduced its oil prices
