Oil and gas exports have sustained Russia's finances throughout its war against Ukraine.But as the fourth anniversary of the full-scale invasion approaches, those cash flows have suddenly dwindled to lows not seen in years.It's the result of new punitive measures from the U.S.
and the European Union, U.S.President Donald Trump's tariff pressure against India, and a tightening crackdown on the fleet of sanctions-dodging tankers carrying Russian oil.
The drop in revenue is pushing President Vladimir Putin to borrow from Russian banks and raise taxes, keeping state finances on an even keel for now.But those measures only increase strains in a war economy now plagued by slowing growth and stubborn inflation.In January, Russian state revenues from taxing the oil and gas industries fell to 393 billion rubles ($5.1 billion) That’s down from 587 billion ($7.6 billion) in December and from 1.12 trillion ($14.5 billion) in January 2025.
That's the lowest since the COVID-19 pandemic, says Janis Kluge, an expert on the Russian economy at German Institute for International and Security Affairs.To pressure the Kremlin to halt fighting in Ukraine, the Trump administration imposed sanctions on Russia’s two largest oil companies, Rosneft and Lukoil, from Nov.
21.That means anyone buying or shipping their oil runs the risk of being cut off from the U.S banking system — a serious concern for any multinational business.On top of that, on Jan.
21 the EU began banning fuel made from Russia crude — meaning it could no longer be refined somewhere else and shipped to Europe in the form of gasoline or diesel fuel.The head of the EU's executive commission, Ursula von der Leyen, on Friday proposed a full ban on shipping services for Russian oil, saying sanctions offered leverage to push Russia to halt the fighting.“We must be clear-eyed: Russia will only come to the table with genuine intent if it is pressured to do so," she said.The latest sanctions are a step beyond the oil p...