Russia's income increased in the first quarter due to the rise in oil

Russia's income increased in the first quarter due to the rise in oil

Russia saw strong revenue growth in the first quarter due in part to one-time tax payments and rising oil pricesas the country continues to weather sanctions for its war in Ukraine.

Russia observed a “sustained positive dynamic” in the flow of money to the federal budget, according to a statement from the Ministry of Finance on Monday. Revenue in the three months through March amounted to 8.7 trillion rubles ($94 billion)53.5% more than in the same period of the previous year, according to Ministry data.

“The economy continues to grow at an impressive pace,” Bank of Russia Governor Elvira Nabiullina declared Monday in a speech to the Lower House of Parliament. Revenue from non-energy industries increased 43% year-on-year, forming “a stable foundation to continue advancing income growth,” the Ministry of Finance said. “One-off” payments contributed significantly, including exit fees paid by foreign companies leaving Russia.

Oil and gas revenues grew rapidly, almost 80% more than last year, driven by rising prices and a one-time payment of taxes by oil companies.

Brent crude oil is trading above US$90 a barrel this Monday, up almost 20% since the beginning of the year due to escalating geopolitical tensions and supply disruptions. In 2023, energy revenues decreased by 23.9% to 8.8 trillion rubles, despite the fact that overall budget revenues recorded a slight increase compared to 2022. This was due in part to the ban imposed by the European Union on most seaborne imports of crude oil and petroleum products from Russia, and to price caps imposed by the Group of Seven countries, both intended to punish the country for its invasion of Ukraine.