Business Insider
Putin says Russia lost $15 billion in oil and gas revenue last quarter, but thinks the hole can be filled in the next few months
Jennifer Sor – April 13, 2023
- Russia lost over $15 billion in oil and gas revenue over the past quarter.
- But that hole in the Kremlin’s budget can be filled, President Putin said this week.
- Academics have criticized Putin for misrepresenting the state of Russia’s economy.
Russia lost over $15 billion in oil and gas revenue in the first quarter of 2023 – but that gaping hole in the Kremlin’s budget can be filled over the next few months, according to Russian President Vladimir Putin.
At a televised government meeting on Tuesday, Putin said Russia’s oil and gas revenue fell by $15.8 billion in the first quarter amid tightening Western sanctions following Moscow’s invasion of Ukraine last year.
The Kremlin posted a $29 billion budget deficit in the first quarter overall, as military spending also increased to continue waging war and mobilizing hundreds of thousands more troops.
Despite the losses, Putin emphasized the resilience of the Russian economy, adding that he foresaw a “positive trend” as oil prices would continue to rise.
“It is expected that by the end of the second quarter, against the backdrop of rising oil prices, the situation will change. Additional oil and gas revenues will begin to flow into the budget,” Putin said, per Reuters‘ report.
Oil and gas exports are among Russia’s main revenue sources, but they have plunged since Western countries shunned Moscow’s supplies and imposed sanctions.
Putin has rebuffed those sanctions as “stupid,” and Russia has responded by slashing its oil production by half a million barrels per day.
OPEC+, of which Russia is a member of, also recently announced a surprise production cut of over a million barrels a day. The cuts have pushed oil prices upward, helping Russian export revenue going forward.
Still, academics have criticized Putin for misrepresenting Russia’s situation: The Central Bank of Russia hasn’t disclosed important statistics that could paint a bleaker picture of its situation, like the nation’s exports and imports, and its economic growth forecasts this year are largely created from “cherry-picked” numbers, two Yale researchers said this week.
Experts are also seemingly confused about Russia’s economy, with top forecasters divided on whether its economy is growing or shrinking. Morgan Stanley, Goldman Sachs, and World Bank are all expecting a mild decline in real GDP this year.