Source link : https://london-news.net/russia-prepares-for-oil-price-declines-as-economic-forecast-revised-downward/
Russian officials are preparing for a persistent decline in oil prices, as the Economic Development Ministry has notably lowered its forecast for the average price of Urals crude oil for 2025 to $56 per barrel.
This forecast represents the lowest expected price since 2020, during which the Covid-19 pandemic caused a drastic drop in global demand, resulting in an annual average price of $41.70 per barrel for Urals. Prior to 2020, prices fell below $56 only in 2015 and 2016, averaging $51.20 and $41.90, respectively.
The revised forecast is significantly below the $69.70 per barrel projection included in Russia’s federal budget and even beneath the threshold price of $60.
According to Russia’s fiscal regulations, any oil and gas revenues that exceed this threshold contribute to the National Wealth Fund (NWF), while revenues falling short must be compensated by withdrawals from the fund. As of April 1, the NWF had 3.27 trillion rubles ($39.8 billion) in liquid assets.
The downturn in oil prices coincides with a global economic slowdown and heightened recession fears, partly fueled by a trade conflict initiated by the U.S. Recently, Brent crude prices fell below $60 per barrel, and Urals dipped below $50. In the first quarter of 2025, federal budget revenues from oil and gas experienced a 10% year-over-year decrease, with a significant 17% drop occurring in March alone.
Each $1 fall in oil prices results in an approximate annual revenue loss of 160 billion rubles ($1.9…
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Publish date : 2025-04-21 16:46:00
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