Russia Logs 4th Straight Year of Fiscal Shortfall

2026-01-19 15:24 By Luisa Carvalho 1 min. read

The Russian federal government posted a budget deficit of RUB 5.65 trillion in 2025, the largest since at least 1996 and up from RUB 3.47 trillion a year earlier, according to preliminary figures.

This marked the fourth consecutive year of fiscal shortfall amid the ongoing war in Ukraine, as expenditures rose 6.8% to RUB 42.93 trillion.

Meanwhile, revenues increased only 1.6% to RUB 37.28 trillion, constrained by a 24% decline in oil and gas revenues to a five-year low of RUB 8.48 trillion, driven by lower average oil prices and an increased discount on Russian crude amid tighter sanctions.

By contrast, non-oil and gas revenues rose 12.6% year-on-year to RUB 24.9 trillion.

Russia ran a fiscal deficit equal to 2.6% of GDP in 2025, the highest since 2020, in line with the revised target.

The government raised the target twice after the original 0.5% goal was derailed by shrinking energy revenues and a strong rouble.



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