Russia's Oil and Gas Exports Yield Lowest Income Since 2022: Revenues Unseen in the Prior Year
Revised Article:
May 2025 saw Russia's income from selling fossil fuels abroad plummet to the lowest level since the full-scale war against Ukraine began. That's according to a monthly report by the Centre for Research on Energy and Clean Air (CREA).
Here's a breakdown of the earnings:
- Russia made €176 million daily from seaborne crude oil exports, a decrease of 8% compared to April and a 22% drop year-on-year. Despite a 4% increase in physical shipments, the average price of Urals crude, Russia's benchmark oil, plummeted to $57.3 per barrel, slashing total earnings.
- Pipeline oil export revenues added €59 million per day (a 8% decrease). Gas exports in May generated €101 million per day - €51 million from pipeline gas and €40 million from LNG. Revenues from oil product sales stayed at the April level - €101 million per day. Meanwhile, coal export revenues jumped by 18%, reaching €74 million a day.
The main purchasers of Russian energy remained:
- China - €5.7 billion monthly, primarily for oil;
- India - €4.2 billion;
- Türkiye - €1.8 billion, including €1.1 billion for oil products.
The European Union bought around €1 billion worth of Russian energy. Over 70% was gas, while the remaining 30% was oil, still being supplied via the Druzhba pipeline to Hungary and Slovakia.
CREA warned that slashing the price cap on Russian oil from $60 to $45 per barrel could cut Russia's foreign currency earnings by an additional €2.7 billion per month, or around 27%. Nearly 40% of Russia's oil exports are dependent on Western tankers, which might leave the market should sanctions tighten.
We're living in a time when Russia relentlessly invades Ukraine, so it's no surprise that Russia's oil and oil product export revenues suffered in May 2025, mainly due to three factors:
- Sanctions and increased maritime enforcement by G7+ countries have made it harder for Russia's "shadow fleet" of older, underinsured vessels to carry oil, thereby limiting Russia's export earnings despite some volume increases.
- Decreasing global prices for Russian oil and oil products contributed to the revenue drop. Lower prices meant that even though export volumes rose in certain categories, total revenues still declined.
- Volume decreases in key export segments, such as seaborne crude oil, pipeline gas, and pipeline crude oil, compounded the revenue loss.
Additionally, operational disruptions like the collision of two vessels near the Strait of Hormuz added to market uncertainty, contributing to the flow and pricing turbulence of exports. Moreover, while revenues from coal exports surged, and LNG volumes soared, these gains weren't enough to counterbalance the declines in oil and pipeline gas revenues, which primarily drive Russia’s fossil fuel export income.
- The slump in Russia's culture and industry sectors might be imminent, considering the decreased foreign currency earnings from fossil fuel exports, which account for a significant portion of their economy.
- The finance sector could be impacted as well, with potential restrictions in accessing international markets due to increased sanctions and the withdrawal of Western tankers from Russian energy transportation.
- The health of the population could be affected long-term, as reduced revenue from fossil fuel exports may affect Russia's ability to invest in essential services like healthcare and social welfare programs.
