Russia’s federal budget deficit reached 4.58 trillion rubles in the first quarter of 2026. This figure is 700 billion rubles higher than the Kremlin’s total target for the entire year. The collapse of oil and gas export revenues remains the primary cause of this financial failure.
The Russian Ministry of Finance reported a critical imbalance in the state’s financial accounts. Preliminary data for January-March 2026 reveal the budget gap hit 1.9% of the nation’s GDP. This deficit is 2.3 times larger than during the same period last year. The government spent 12.89 trillion rubles while generating only 8.31 trillion in revenue. Essentially, every third ruble spent lacked actual tax coverage.
Revenue Collapse and War Expenditures
Oil and gas revenues plummeted by 45%, dropping to 1.44 trillion rubles. This marks the lowest level of energy income since the pandemic era. Non-resource sectors are also failing to compensate for the loss. Despite significant tax increases, revenues from these industries grew by only 7%. Russia’s economy suffers from systemic pressure due to international isolation.
Meanwhile, federal spending surged by 17%. Moscow officially describes this as “advance financing.” In reality, it reflects the massive costs of maintaining the full-scale war against Ukraine. Internal financial reserves are depleting much faster than Moscow anticipated. Sanctions continue to target the banking sector and the purchasing power of citizens.
Economists expect a brief improvement in April due to rising global oil prices. Early this month, Urals crude jumped to 116 dollars per barrel. This price nearly doubles the forecast set in the Russian state budget. However, the structural crisis continues to worsen. International experts previously warned of a potential large-scale financial crisis in Russia by summer 2026.
Previously, The Ukrainian Review reported that Ukrainian drones struck key Russian logistics and defense targets.
