With the rise in oil exports and fuel prices, Russia’s earnings increased to $337.5bn this year, a 38% increase from 2021, according to an economy ministry document seen by Reuters.
If the revenue materialises, it will help Russia’s economy despite the sanctions imposed by the West in the wake of Russia’s invasion of Ukraine.
According to Reuters, the ministry document predicts that energy export earnings will fall to $255.8bn next year but remain higher than the $244.2 bn forecast for 2021.
According to the forecast, the average petrol export value will double this year to $730 per 1,000 cubic metres before gradually declining until the end of 2025.
Russia is Europe’s largest petrol supplier. In February, supply fell as one of the supply routes was closed due to Moscow sending armed forces into Ukraine.
Russia cut off supplies to some European countries as they refused to pay in roubles. Nord Stream 1 pipeline flows from Russia to Germany were also halted, citing maintenance work.
As a result, oil prices skyrocketed, threatening European customers with energy rationing this winter.
The economy ministry expects pipeline gas volumes from Russian exporter Gazprom to fall to 170.4 billion cubic metres (bcm) this year, down from 185bcm forecast in May and 205.6bcm exported in 2021.
In June, crude exports remained stable at 5.4 million barrels per day (bpd), but refined product shipments fell 155,000 bpd from April to May 2022 to 2.4 million bpd.
In a monthly oil report, a Paris-based International Energy Agency said: “With higher crude oil and product prices globally, Russian oil export revenues are estimated to have increased by $1.7bn in May to about $20bn.”
According to Russian Deputy Prime Minister Alexander Novak, Russian oil exports increased by 12% in the first five months of 2022. Even after six rounds of Western sanctions imposed on Russia, the energy export value in 2022 remains higher than in 2021.
As the Western sanctions limited the exports from Russia, Asian buyers took advantage of the relatively lower costs of oil. Since the invasion, Russian crude supplies to China increased to 2 million barrels a day, representing a 55% year-on-year increase in May 2022.
The GDP of Russia in 2021 was worth $1.78tn, according to the World Bank. Russia’s economy could struggle in the long term as Western sanctions continue. The International Monetary fund expects Russia’s GDP to fall by 6% in 2022, and 3.5% in 2023.
Senior associate at the German institute for international and security affairs, Janis Kluge, said: “The impact of sanctions on Russia’s economy is very uneven. In some sectors, it has been catastrophic, such as the car industry. The oil sector is relatively unscathed for now.”