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Data shows that the price of oil in Russia is at a two-year low and 40% below the budgeted amount.

Data showed that the price of oil in Russia in roubles had fallen to its lowest level in two years, below the 4,000-rouble mark per barrel, and was 40% less than what the federal budget planned. This increased pressure on the Kremlin which is already struggling with a growing budget deficit.

Global oil prices are down over 10% for six sessions in a row, and over 20% in the past year since U.S. President Donald Trump’s tariff shocks in April prompted more bets that global economic growth would slow.

The oil prices also fell following the Organization of the Petroleum Exporting Countries' (OPEC) decision to increase output. This group, led by Russia and known as OPEC+, has accelerated the production of crude oil.

Calculations show that the average price for Russia's Urals and ESPO blends dropped on May 2, to $48.92 a barrel or 3,987 roubles. This is 40% less than the 6,726 roubles originally planned by the government.

According to data, this is the lowest level since May 2023.

The price of the Russian oil blend used to tax is still below the government's recently revised forecast at 5,281 roubles a barrel.

Trump said that Vladimir Putin, the Russian president, was more inclined to peace following the recent drop in oil prices.

Last week, the fall in energy prices, which accounts for one-third of the federal budget's proceeds, led the Russian government to increase the estimate of the budget deficit for 2025 to 1.7% of the gross domestic product, from 0.5%.

It was a response to a reduction of 24% in the forecasted energy revenue due to expectations that oil prices would remain low for a long period.

Russia has already increased its state defence spending by a quarter to 6.3% in 2025, the highest since the Cold War. The country is still fighting in Ukraine and this war is now in its 4th year.

Analysts believe the government has no choice but to raise taxes, cut some social spending that is sensitive, and borrow heavily to balance budgets in the future without cutting defense spending.

According to data, the average Russian oil price per barrel has been falling in recent months. It was 5,079 Roubles in March to 4,562 Roubles in April. Reporting and Editing by Andrew Osborn

(source: Reuters)