Russia’s Ministry of Economic Development forecasts that next year Russian oil will be sold abroad at an average price of $53 per barrel, with Brent expected to average $73. The $20 difference, or 27%, will represent a record discount in the ministry’s budget calculations.
The Moscow Times reported this, citing the Russian Ministry of Economic Development’s macroeconomic forecast for the next three years, which served as the basis for drafting Russia’s budget.
Record oil discount
According to the Russian Ministry of Economic Development’s estimates, the discount on Russian oil relative to Brent will amount to $20 per barrel next year. The ministry considers it the largest for the entire period during which discounts on Russian grades have been taken into account in budget planning.
For comparison, Russia’s budget for the current year assumed a Brent price of $70 per barrel, while Urals was set $11, or 16%, lower. The 2025 budget was drafted with a 15% discount: Urals was forecast at $69.7 per barrel and Brent at $81.7.
In the 2024 budget, the Russian Ministry of Economic Development forecast the price of Urals at $71.3 per barrel, compared with $83.5 for Brent.
Export and foreign currency revenue forecast
The Russian Ministry of Economic Development also expects crude oil exports to decline from 244 million tonnes this year to 230.8 million tonnes next year. In 2028–2029, exports are projected by the ministry to total 216.6 million tonnes.
The original report notes that potential U.S. sanctions could affect crude oil exports, but does not specify any particular restrictions, the timing of their introduction, or an official source for this information.
The forecast for exports of gas to non-CIS countries and liquefied natural gas has also been revised downward:
- gas to non-CIS countries — to 77.5 billion cubic meters instead of 82.5 billion;
- LNG — to 39.5 million instead of 46.9 million.
According to calculations by the Russian Ministry of Economic Development, foreign currency revenue for Russian oil and gas companies will fall from $219.4 billion this year to $194.1 billion next year. This will be the lowest figure since 2020. In 2028, revenue is projected by the ministry to decline to $192 billion.
Situation in oil refining
Russian oil refineries have been cutting production for the third consecutive month. Over eight months, output of petroleum products in Russia declined by 10.3%.
At the same time, Russia has launched its largest Arctic oil project since the Soviet era. As noted in the report, no other fields with a comparable resource base remain in Russia.
