Russia energy revenues to drop to 2.7% of GDP by 2029

Russia’s oil and gas revenues are projected to drop to 2.7% of GDP by 2029 as the country faces stabilizing global energy prices and a shifting economic structure. The forecast, published in the federal budget and tax policy guidelines for 2027–2029 and reported by TASS on Sunday, 4 October, indicates a steady decline from the 5.5% share recorded in 2024. Projected Revenue Devaluation The Russian government estimates that hydrocarbon revenues will reach 3.3% of GDP in 2026 before further contracting over the subsequent three-year planning period. This downward trend is attributed to fluctuating exchange rate dynamics, global energy price trends, and changes in hydrocarbon production and export volumes. The document suggests that the oil and gas sector is currently occupying a smaller relative share of the overall national economy. The policy guidelines for 2027 through 2029 emphasize that the contraction is not solely due to external market pressures but also reflects internal structural changes. This shift occurs as Moscow attempts to navigate international sanctions and evolving trade routes for its energy exports. Non-Oil Revenue Growth To compensate for the shrinking energy income, the federal budget is expected to see a significant increase in non-oil and gas revenues. According to the document, this growth will be driven by an expansion of the tax base and improved efficiency in tax collection. The projections also factor in implemented and proposed legislative…