"Lukoil Is Sounding The Alarm
- 26.01.2026, 16:11
The company asked for help from the budget due to the collapse of Russian oil prices.
The collapse in the price of Russian oil, which is sold at a discount of almost 50% to world quotations, has forced Russia's largest private oil company to ask for help from the government.
Lukoil, which has fallen under U.S. sanctions, is asking the Energy Ministry to change the taxation procedure in order to receive payments from the federal budget, according to "Izvestia" citing a letter the company sent to the Cabinet.
According to the publication, Lukoil is asking to change the formula of the dempfer mechanism, which was introduced in 2018 to stabilize gasoline prices. Now under the damper, the state pays oil companies extra from the treasury if domestic fuel prices stay below world prices. If the situation is the opposite, the companies are charged an additional tax.
Because of the fact that discounts on Russian oil exceeded $20 per barrel, oil companies will have to pay 13 billion rubles to the budget under the damper in December. "Lukoil" proposes to limit the discount taken into account in taxes at the level of $10-15 per barrel, so that oil companies pay nothing and, on the contrary, can receive budget money.
The oil industry is concerned about the growth of the discount on Russian Urals to Brent, because of which the payments on the damper went "into the negative zone", "Izvestia" quotes the letter of "Lukoil". Last year the budget paid 881 billion rubles to oil companies under this mechanism, and a year earlier - 1.8 trillion rubles. Now, because of the low price of Ural, oil companies will have to transfer 47 billion rubles to the treasury under the damper in December-January, estimates the managing partner of Kasatkin Consulting Dmitri Kasatkin.
This will hit the finances of oil companies, which have already faced a sharp drop in profits. Thus, "Lukoil" at the end of the first half of 2025 lost half of its profit - it amounted to 287 billion rubles against 590 billion rubles a year earlier. "Rosneft", which ranks first in terms of production and exports, reported a threefold drop in profits for January-September - to 277 billion rubles.
Winter brought new problems for oil companies: the average price of Urals fell to $39 in December, in January - to $35-37, the lowest level since the pandemic, when the global market of "black gold" experienced an unprecedented collapse. With oil prices below $40, about half of Russia's oil production projects have become unprofitable: companies are losing $5 on every barrel sold, industry sources told Reuters. According to them, it is mainly the fields that do not pay the full rate of the mineral extraction tax, which accounts for more than 90% of oil and gas budget revenues, that remain on the plus side.