Russia's federal budget revenue from oil and gas sales may drop in May by around 55 billion roubles (US$708 million) compared with April, due to a fall in profit-based tax on oil production, Reuters calculations showed on May 18.
According to the calculations, oil and gas revenues may reach 593 billion roubles, down from 648 billion roubles in April and 886 billion roubles in May 2022.
The decline in income from oil - a huge source of budget revenue — is likely to exacerbate an already high budget shortfall. Russia recorded a 3.4 trillion-rouble ($44 billion) deficit in the first four months of the year as spending rose, not least from Moscow's military campaign in Ukraine, and energy revenue fell.
Russian oil and gas are subject to a range of Western sanctions limiting sales to the West and also attempting to cap the global price of Russian oil.
Finance Minister Anton Siluanov said on May 17 that Russia's revenues from oil and gas were behind plan.
Profit-based tax may drop to as low as zero this month as the taxpayers are allowed to pay it approximately once in a quarter, and it's not usually in May.
In March and April, the tax generated payments to the budgets of 221 billion roubles and 185 billion roubles respectively, according to finance ministry.
At the same time, the mineral extraction tax revenue on oil may rise this month by 128 billion roubles from April thanks to an increase in prices of Russia's flagship Urals oil blend and a weaker rouble.
Recommended Reading
April US Shale Production Set to Rise to Highest Since December 2019
2023-03-13 - Crude output in the Permian Basin in Texas and New Mexico, the biggest U.S. shale oil basin, is expected to rise to 5.62 MMbbl/d. Though that would be a record high, oil output from the region is expected to gain by 26,000 bbl/d from the previous month, it’s also the smallest increase since last December, the data showed.
Russia's Oil Heartland in Siberia Boosts Drilling in March
2023-04-24 - West Siberia boosted oil well drilling in March as it tries to keep up production capacity amid Russian output cuts.
Analysts: Callon’s $1.1 Billion A&D Aids Debt Reduction, Investor Returns
2023-05-09 - Callon’s exit from the Eagle Ford Shale will refocus the E&P as a Permian pure-play and should help reduce debt and return capital to investors, analysts say.
Occidental CEO: US Permian Production Has Yet to Hit Peak
2023-04-12 - Occidental Petroleum CEO Vicki Hollub said Permian Basin hasn't yet peaked while Pioneer Natural Resources CEO Scott Sheffield said prices could hit $90 per barrel or more this year.
Pemex Eyes Slight Uptick in 2024 Production
2023-03-23 - State-owned Pemex expects liquids production to average 2 MMbbl/d and gas production to average 4.8 Bcf/d in 2024.