Russia's federal budget deficit could grow almost threefold by the end of 2026 compared to official government forecasts due to a sharp drop in oil export revenues, a reduction in purchases of russian raw materials from India, increasingly large discounts to buyers, and further growth in spending on the war against Ukraine.
It was reported by Reuters with reference to internal calculations by economists of a think tank affiliated with the russian government.
According to analysts, in 2026, budget revenues from the energy sector may be 18 percent lower than the figures that were included in the kremlin's financial plans. In this case, the budget deficit will increase to 3.5-4.4 percent of gross domestic product, while the official government forecast envisaged a deficit of 1.6 percent of GDP.
The total revenues of the russian federal budget are expected to decline by about 6 percent to about 37.9 trillion rubles. At the same time, the expenditure side of the budget may exceed the planned figures by 4.1-8.4 percent due to additional funding needs, primarily related to the war.
Among the key factors of pressure on the russian economy, experts say the effect of international sanctions, high interest rates in the country and an acute shortage of labor. An additional negative factor was the strengthening of the ruble in 2025, as taxes from the oil and gas sector are calculated in US dollars but paid to the budget in rubles, which reduces real revenues.
The russian government currently has about RUB 4.1 trillion of fiscal reserves at its disposal. At the same time, analysts at Alfa-Investments and VTB Bank warn that at the current rate of revenue decline, these reserves could be completely exhausted within one year.
A Reuters source close to the russian government said the Kremlin's intentions to cut military spending were unrealistic given the government's current priorities and the course of the war.
As the Ukrainian News agency earlier reported, on January 27, oil prices declined slightly despite a severe snow storm in the United States, as investors watch for the resumption of oil supplies from Kazakhstan.
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