Russia’s oil and gas revenues surged in April but were largely offset by billions in subsidies and refinery repair costs linked to Ukraine’s strikes on energy infrastructure.
According to the Institute for the Study of War report published on Wednesday, May 6, Moscow is struggling to fully capitalize on rising global oil prices due to mounting domestic costs.
Russia’s finance ministry said federal revenues from oil and gas nearly doubled month-on-month, reaching 917 billion rubles (about $12 billion) in April, up from 443 billion rubles ($6 billion) in March. Oil revenues alone accounted for 771 billion rubles (around $10 billion).
Subsidies, repairs eat into profits
At the same time, Russia sharply increased spending to support its energy sector, allocating nearly 350 billion rubles (about $4.7 billion) in subsidies to oil companies.
According to Russian opposition outlet Vlast, the funds are used to keep domestic fuel prices low and to repair and modernize refineries damaged in Ukraine’s long-range strike campaign.
These costs are largely offsetting additional revenues driven by higher oil prices sparked by the US/Israel-Iran, with total oil and gas income reaching about 856 billion rubles ($11.4 billion) in April – only slightly above earlier forecasts.
An unnamed source in the finance ministry told Vlast that revenues are expected to grow further in May, with Finance Minister Anton Siluanov previously projecting an additional 200 billion rubles (about $2.7 billion).
Ukrainian strikes limit export capacity
ISW analysts noted that Ukraine’s continued strikes on Russian oil infrastructure are reducing export capacity and limiting revenue gains.
Key ports, including Ust-Luga and Primorsk in Russia’s Leningrad region, are operating below capacity, preventing the Kremlin from fully benefiting from higher oil prices and partial easing of US sanctions.
The report suggests that Ukraine’s campaign targeting oil facilities in Russia’s rear is likely to continue undermining Moscow’s energy revenues in the coming months.