Russian Government Reports On Russian Oil Price Falling Below $40 Per Barrel
- 13.01.2026, 20:38
For the first time in five years.
The average price of Russian Urals crude oil in December 2025 has fallen to $39.18 per barrel, the Russian Ministry of Economic Development said Tuesday.
Compared to November ($44.87), the main export mark of Russian oil producers became cheaper by another 13%, and compared to the beginning of the year ($67.66 in January) - by 41%, reports The Moscow Times.
Because of Donald Trump's sanctions against Rosneft and Lukoil, discounts on Urals reached record levels since the start of the war: up to $28 a barrel to Brent in Baltic Sea ports and $26 in the Black Sea, according to Argus statistics. As a result, the average cost of Russian oil has fallen to its lowest since May 2020 ($31.03), when a pandemic was raging in the world and the global oil market experienced an unprecedented collapse.
De facto, the price of oil has returned to the marks of Vladimir Putin's first term ($41.73 per barrel in 2004) and is holding almost $20 below the level included in the budget-2026 ($59 per barrel).
In January-November last year, the federal treasury lost every fifth ruble of oil and gas revenues, and in December their decline accelerated to 49% year-on-year, according to Reuters calculations.
In this year's budget, the Finance Ministry has budgeted 8.9 trillion in oil and gas revenues. But in fact, with current prices and discounts, they will be 1.1-1.4 trillion rubles below the plan (7.5-7.8 trillion), according to economist Dmitri Polevoy. As a result, the treasury deficit, which is planned at 1.6% of GDP, may reach 2.5-2.7% of GDP, and the government will have to use the National Welfare Fund balances to cover the shortfall in revenues, the expert warns.
Now the liquid assets of the National Welfare Fund amount to Br4.1 trillion. This may be enough for 1.5-2 years of unfavorable oil conditions, Polevoy estimates. With prices around $40 per barrel, oil production at a number of fields in Russia has become unprofitable, industry sources told Reuters earlier. According to Bloomberg, in December, despite the OPEC+ quota, Russia saw a noticeable reduction in oil production - by 100,000 barrels per day, to 9.326 million barrels.
"Sanctions against Rosneft and Lukoil create problems for Russian exports. And there is no more room to store (unsold) oil," describes the situation to Janis Kluge, an expert at the German Institute for International Security Problems. According to Bloomberg, the volume of Russian oil "at sea" - that is, on tankers waiting for buyers - has increased by 35 million barrels since the end of November, when U.S. sanctions took effect.