In June, budget revenues from the oil and gas sector increased compared to May, rising by 4.7 billion rubles to a total of 683.6 billion rubles. The primary driver of this revenue growth was the reduction in budget payments related to the reverse excise tax on oil, which decreased by 51.1 billion rubles in June. This serves as clear evidence of a decline in the volume of oil being sent for domestic processing, as this tax is applied to those volumes.
In July, the situation may undergo a significant transformation. To increase the supply of fuel in the domestic market, the list of fuel producers eligible for budget subsidies has been expanded. Furthermore, gasoline importers into Russia will also be eligible for these subsidies. However, tax revenues from the oil and gas sector are not expected to increase; instead, they are likely to decline.
Taxes are paid based on the results of the previous month, meaning that June's payments will relate to May, and July payments will pertain to June. The price of Russian Urals oil, which is used to calculate fiscal payments, has dropped from $94.87 per barrel in April to $86.52 in May, and further down to $63.52 in June. Taxes are paid in rubles based on the average exchange rate against the dollar for that month. Oil production levels also play a role, but they have remained relatively stable since the beginning of the year, according to OPEC: 9.02 million barrels per day in April and 9.01 million barrels per day in May. June statistics have yet to be released, but production is likely to drop slightly.
In June, revenues from the main industry tax on mineral extraction (MET) decreased month on month by 45.6 billion rubles. In July, further declines are probable due to the reduction in the price of Russian oil in June, which may be partially offset by a slight depreciation of the ruble against the dollar (by 54 kopecks). Here, it becomes crucial to assess how much budgetary subsidies for oil producers can be increased, as these also depend on oil prices and the ruble exchange rate.
There are two types of payments involved: the previously mentioned reverse excise tax and the damping mechanism (compensation from the budget to oil companies for part of the difference between the domestic fuel price and its export price). Large oil refineries were eligible for these payments under certain conditions, including entering into investment agreements with the government for the modernization of production facilities and committing to supply specific quantities of fuel to the domestic market. The amount received through the reverse excise tax is linked to the volumes of processed oil at these refineries. Now, the quality specifications for obtaining the reverse excise tax and damping have been lowered, making payments accessible to those producing fuel by blending straight-run gasoline (the primary product of oil refining) with other components. This results in increased sulfur content in gasoline and a reduced shelf life.
Additional payments from the budget are expected to stimulate oil producers to increase fuel output.
As explained in an interview with "RG," Konstantin Simonov, head of the National Energy Security Fund, noted that this adjustment aims to enable oil companies to swiftly ramp up gasoline production, even if at a lower quality, during periods of shortage, without losing out on reverse excise payments. However, the expert emphasizes that the modernization requirements for production facilities remain in place as the ultimate objective for Russian refineries.
To enhance fuel supply, the damping mechanism is now also available to importers. This decision will help prevent domestic gasoline and diesel prices from escalating and make such imports profitable for intermediaries. Previously, the damping was only available to Russian and Belarusian refineries. Now it extends to gasoline imports: for fuel from EAEU countries, a coefficient of 0.9 has been set starting June 1, 2026, while a separate formula based on import parity will be introduced for supplies from other countries.
According to Daniel Tyun, CEO of DA Consulting, the impact on budget expenditures could be noticeable but not catastrophic in the first month. If we apply May's parameters, each additional 100,000 tons of supported fuel could cost the budget approximately 2.5-2.7 billion rubles. If blending and imports can add 500,000 tons per month, that would result in an additional burden of 12-14 billion rubles. Should the increase reach 1 million tons, it could mean an additional 25-30 billion rubles monthly.
A similar sentiment was expressed by Sergey Frolov, managing partner at NEFT Research, albeit with a caveat. Payments to importers and oil depots (fuel production through blending) are unlikely to significantly increase the budget's revenue losses, provided these forced measures do not extend beyond 3-4 months, he believes.
Moreover, as Simonov notes, payments from the excise are tied to the price of our oil, while the damping is based on the export price of petroleum products, meaning that payouts will decline alongside oil and gas revenues. Overall, these payments will not pose a serious challenge to budget revenues. The key is for them to serve as an incentive for oil companies to boost production, according to the expert.
Sergey Tereshkin, CEO of Open Oil Market, stated that the size of the payments will be influenced by the ongoing correction in the oil market, which is reflected in the dynamics of external prices for petroleum products. Therefore, the damping payments for fuel producers are unlikely to exceed 200 billion rubles (210.6 billion rubles in June). As for payments to importers, comparatively low volumes of supplies will serve as a limiting factor.
Tyun believes that the measures implemented could function without significant detriment to the treasury only as a short-term crisis response—lasting a few months—while refineries recover and seasonal fuel shortages are resolved. If Urals remains above $60-65 per barrel, and imports and mixing remain targeted, the budget may sustain additional payments of 10-30 billion rubles per month. However, if oil prices drop below $55-60, the ruble stays strong, and the damping payments exceed 200 billion rubles monthly, the mechanism will quickly erode oil and gas revenues. The main risk is that the current decisions address symptoms rather than the root cause, which is the decline in fuel output due to refinery issues. In such a case, damping and reverse excise payments can stabilize prices and stimulate supplies, but they cannot replace physical processing, the expert emphasizes.
Source: RG.RU
