patrick.net

Russian Deficit Soars to $25 Billion on War Spending, Oil Embargo

Budgetary pressures on President Vladimir Putin’s government grow war in Ukraine nears one-year mark

Feb. 6, 2023 12:57 pm ET

Western oil sanctions and soaring battlefield costs took a heavy toll on Russia’s finances last month, pushing the government budget into its deepest deficit to start the year in more than a decade.
Oil and gas revenues nearly halved, dropping 46% in January from the same month last year, according to data from the Russian Ministry of Finance published Monday. Government spending, driven by military purchases, jumped by 59% from last January.
That left the budget with a deficit of around $25 billion, the statistics showed, marking the worst budget performance at the start of the year in official data going back to 2011. The government has increasingly turned to its rainy-day fund to plug the gap.
The data offers a stark illustration of the growing budgetary pressures on President Vladimir Putin’s war economy as his invasion in Ukraine nears its one-year mark. It puts the government in a quandary of how to stimulate the sanctions-stricken economy, support the local population and pay for the war effort.
“Throughout much of last year, it seemed like the war expenses could not destabilize Russia’s government finances,” Janis Kluge, an expert on Russia at the German Institute for International and Security Affairs. “Now, as the actual costs become clearer and the oil embargo kicks in, this isn’t so sure.”

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At the start of the war, Moscow benefitted from ample energy revenues as prices rose and it was still selling oil and gas to Europe, its biggest market. But a European Union ban on most Russian crude oil deliveries as well as a price cap agreed by the Group of Seven in December have limited Moscow’s ability to sell its most prized asset. While Russia has been able to divert sales to Asia, the sanctions have eroded its bargaining power.
Russia’s flagship Urals blend now trades around $50 a barrel, a deep discount to global benchmark Brent crude which changes hands around $80 a barrel. 
Moscow’s decision to stop most natural gas exports to Europe has also taken a toll on revenues. 
Another EU ban, on the imports of Russian diesel fuel and other oil products, took effect on Sunday, further clouding the budgetary picture. The U.S. and its allies also recently agreed to cap the sales price of premium Russian petroleum products such as diesel at $100 a barrel and limit low-value ones such as fuel oil to $45 a barrel.
Russia typically relies on oil and gas sales for around 45% of its budget revenues. The drop in oil and gas sales in January pushed overall budget revenues down by more than a third, the data showed. 
On the expenditures side, Russia’s shift into a war economy has sparked a jump in public procurement. January’s data follows a similar jump in spending in December. Mr. Putin has said that Russian factories are working in multiple shifts to cope with the increased demand for military goods. He has said that there are no limits for financing the Russian army.
“The defense-industrial complex greatly contributes to the dynamics of the manufacturing sector,” Mr. Putin said last month. “Over the past year, it has seriously picked up steam and continues to increase capacity.”
While the January budget numbers were bad, Russia isn’t in imminent economic trouble. It has found ways to keep its oil flowing to new markets in India, Turkey and China, albeit at a lower price. A price turnaround in global oil markets would provide a boost to Moscow. 
Military production, meanwhile, has jump-started the industrial sector and provided employment for workers. Most economists expect Russia’s economy, which shrank last year, to remain in a recession this year, though some forecast a shallower drop in GDP.
The deficit nevertheless creates constraints on Moscow. It increases pressure for the government to borrow through bond issuance, which can exacerbate already high inflation. The government restarted domestic debt auctions in recent months to plug the budget gap.
Last year, Russia recorded a deficit equaling 2.3% of gross domestic product. The Russian government expects the budget to record a deficit of 2% of GDP this year, based on an oil price of $70 a barrel. Banks and analysts polled by Consensus Economics in January expected the deficit to widen to 2.8% of GDP this year. 
The Russian government itself expects to run a deficit at least until 2025. 
Moscow’s National Wealth Fund, built from previous oil and gas sales and used as a rainy-day fund, stood at $152 billion on Feb. 1, the equivalent to 7.2% of projected GDP. That is down from $175 billion, or 10.2% of GDP, before the invasion.

Write to Georgi Kantchev at georgi.kantchev@wsj.com

Preliminary assessment of the execution of the federal budget for January 2023

06.Feb.2023 18:00

According to a preliminary estimate, the volume of federal budget revenues in January 2023 amounted to 1,356 billion rubles [1] , which is 35% lower than the volume of revenues in January 2022:
* Oil and gas revenues amounted to 426 billion rubles and decreased by 46% compared to January 2022, which is primarily due to a decrease in quotations for Urals oil and a decrease in natural gas exports.

...

* Non-oil and gas revenues amounted to 931 billion rubles and decreased by 28% compared to January 2022, mainly due to a reduction in domestic VAT and income tax revenues.

...

According to preliminary estimates, the volume of federal budget expenditures in January 2023 amounted to 3,117 billion rubles , exceeding the figures for the same period last year by 59%.

...

https://minfin-gov-ru.translate.goog/ru/press-center/?id_4=38368-predvaritelnaya_otsenka_ispolneniya_federalnogo_byudzheta_za_yanvar_2023_goda&_x_tr_sl=ru&_x_tr_tl=en&_x_tr_hl=en-US&_x_tr_pto=wapp

A take on the subject of this thread by the reputable Russian economist Guriev:

https://m.youtube.com/watch?v=9X3dOp67Oqg&feature=youtu.be

https://www.dailymail.co.uk/news/article-11754333/New-blow-Putins-men-Viagra-maker-halts-supplies-erectile-dysfunction-pill.html

US Viagra maker halts supplies of erectile dysfunction pill to Russia over Ukraine invasion

(Bloomberg) -- Russia’s oil and gas revenue almost halved in February after Western restrictions on crude and petroleum products took effect and gas exports to Europe fell.
Tax revenue from oil and gas plunged 46% in February from a year ago to 521 billion rubles ($6.91 billion), the Finance Ministry said on Friday. Proceeds from crude oil and petroleum products — which accounted for over two thirds of energy tax revenue last month — fell by 48% to 361 billion rubles, according to Bloomberg calculations.

The drop in contributions to the nation’s budget comes after the price of Urals crude — Russia’s key export blend — has fallen to a significant discount compared to the Brent benchmark. The European Union banned most seaborne imports of crude and petroleum products from Russia, and the Group of Seven industrialized nations imposed a price cap.
With the price of Urals oil averaging just over half of its value a year ago, Russia is seeking to gradually narrow the discount to Brent it uses to calculate taxes in an effort to boost revenue amid sanctions. Energy proceeds account for around at third of nation’s coffers, which are under pressure amid the rising cost of financing the war in Ukraine.

Gas revenue fell almost 42% in February from a year ago to 161 billion rubles, as even higher proceeds from the mineral extraction tax failed to make up for losses from export duties. Budget revenue from gas export duties fell 81% to 40 billion rubles after nation’s gas giant Gazprom PJSC reduced pipeline flows to Europe, historically its largest market, and the fuel price has significantly declined amid warmer-than-usual weather.

GETTING RICHER EVERY DAY!!!

When everyone plays with the kid who has the ball decide that the kid with the ball is really a spoiled petulant brat who always takes his ball and goes home at the slightest provocation, eventually, the other kids make due without the ball and find another game to play.

RWSGFY says

GETTING RICHER EVERY DAY!!!

OF COURSE, PATNET RUSSIA SPECIALISTS TOLD US SO!!!

IN OTHER PATNET SPECIALIST PREDICTIONS, UKRAINE HAS BEEN DEFEATED IN A WEEK AFTER NEVER BEING ATTACKED IN FIRST PLACE, PUTIN THE GREAT IS DEFINITELY NOT A MINOR-ATTRACTED PERSON DESPITE AMPLE PHOTO- AND VIDEO EVIDENCE, AND IS INSTEAD A SAVIOR OF CHRISTIANS AND WESTERN CIVILIZATION!!!

stereotomy says

When everyone plays with the kid who has the ball decide that the kid with the ball is really a spoiled petulant brat who always takes his ball and goes home at the slightest provocation, eventually, the other kids make due without the ball and find another game to play.

BUT THAT BALL IS UNIQUE AND IRREPLACEABLE!!!! NOBODY ELSE HAS A BALL LIKE THAT!!!!!

TWO WEALTHIEST SOVIET OLYGHARCHS LAUGH AND THUMB THEIR NOSES AT STUPID INEFFECTIVE SANCTIONS AND PREDICT USA WILL RUN OUT OF MONEY IN 2023:

https://m.youtube.com/watch?v=ycRnEBAhQog&pp=QAFIAQ%3D%3D

Part of the fleet of Superjet 100 passenger aircraft reportedly risks grounding over a lack of US-made spark plugs for the Franco-Russian SaM-146 engines.

The information was reported by the Telegram channel Aviatorshchina, a Russian telegram channel that regularly publishes insider stories from the aviation industry.

“Over the past 11 months, spark plugs have been supplied by PJSC UEC- Saturn from its reserves, but at the moment, PJSC UAC-Saturn has difficulties in providing this service,” a notice shared by the channel reads. “The current situation leads to the risk of stopping part of the airlines’ RRJ95 [another name for the SSJ100 – ed. note] aircraft fleet in the near future and the gradual complete cessation of flights of the entire fleet of RRJ-95 aircraft, which jeopardizes the implementation of the flight program for the transportation of passengers, including socially significant ones.”

Saturn, a subsidiary of the Russian state company United Engine Corporation, is one of the two companies forming PowerJet, a joint venture in charge of producing and supporting the SaM146, the sole engine powering the Sukhoi Superjet 100 airliner. The other company involved in the joint venture is the French engine manufacturer Safran.

Before sanctions were applied against Russian aviation in the aftermath of the invasion of Ukraine, engine spark plugs for the SaM-146 engines were manufactured by the US-based company Unison Industries.

In late March 2022, PowerJet, the Russian-French manufacturer of the SaM146 engines, said it would suspend its engine maintenance and repair services. A month later, several Russian airlines operating the Sukhoi Superjet 100 warned that they might have to ground the aircraft soon.

Biden just loves sanctions ...

Uganda Enacts Death Penalty for Gay Pedophiles, Biden Threatens Sanctions

The new legislation, which bans homosexuality, the promotion of homosexuality, and gives the death penalty to gay child-grooming pedophiles, “protects and safeguards the sovereignty of this country, the morals of this country, the culture, and we will always legislate for our people,” said Anita Annet, the Speaker of the Ugandan Parliament, when the national legislature voted to pass the law on Wednesday.
https://nationalfile.com/uganda-enacts-death-penalty-for-gay-pedophiles-biden-threatens-sanctions/

RayAmerica says

Biden just loves sanctions ...

Uganda Enacts Death Penalty for Gay Pedophiles, Biden Threatens Sanctions

The new legislation, which bans homosexuality, the promotion of homosexuality, and gives the death penalty to gay child-grooming pedophiles, “protects and safeguards the sovereignty of this country, the morals of this country, the culture, and we will always legislate for our people,” said Anita Annet, the Speaker of the Ugandan Parliament, when the national legislature voted to pass the law on Wednesday.
https://nationalfile.com/uganda-enacts-death-penalty-for-gay-pedophiles-biden-threatens-sanctions/

UGANDA BE KIDDING ME!

RayAmerica says

Uganda

So you insist on lumping Uganda and CCCP into one shithole category? Can't say I disagree....

Eric Holder says

RayAmerica says

Uganda

So you insist on lumping Uganda and CCCP into one shithole category? Can't say I disagree....

I think he's pointing out how ridiculous the US looks with their sanctions.

Other countries just have to ignore the United States, and it's not like we manufacture anything anyhow and the application of sanctions is for the most ridiculous bullshit every time, just makes the United States look vindictive and morally bankrupt.

China sent tents to Syria after their recent earthquake, just obviously a PR move, but the US military confiscated them. These are tents. There's a real winter in Syria.

Remember the "official reason" the US is attacking Syria is "Assad is gassing his own people, MURDERING his own people!!!!". Like the assholes in power give a shit about these people, at all. The US is just run by a bunch of fucking vindictive sociopathic assholes.

richwicks says

I think he's pointing out how ridiculous the US looks with their sanctions.

Looks like you're reading him wrong.

The only ridiculous thing here is the CCCP's rapid descent from the country with "the best edumacation in the world" and "second military in the world" into Ugandesque-level shortage of simple spare parts for anything more comlex than a horse-driven buggy and pulling Stailn-era* T-54 out of storage to send to the frontline.

You know where else T-54 are still being operated? Yes, Africa.

*) Not an exaggeration - T-54 was designed in 1947 and introduced into service in 1948.

Eric Holder says

richwicks says

I think he's pointing out how ridiculous the US looks with their sanctions.

Looks like you're reading him wrong.

He would have to indicate that to me, not you.

Eric Holder says

The only ridiculous thing here is the CCCP's

You insist on using stupid propaganda like this. It's like calling German's Nazis at this point. If you can't even correctly identify the fucking nation, after 30 years, what kind of credibility do you have at all?

Stop using dumb stupid propaganda. The reason you call it the CCCP is because you expect this to invoke a visceral reaction in people who remember the USSR, which isn't many to be honest, you'd have to be at least 45 years old to have any concept of what that nation was like.

Quit trying to push buttons, and reason instead. When you, or anybody, references the CCCP or the USSR, you just look stupid. Maxine Waters was talking about "the Soviet aggression" just a few years ago. She was pillared for this, because it made her look fucking stupid, and I think she is. These fuckers are so fucking old, they don't know what has happened in the last 30 years.

richwicks says

Maxine Waters was talking about "the Soviet aggression" just a few years ago.

That cunt still thinks the Confederate States of America exists.

HeadSet says

richwicks says

Maxine Waters was talking about "the Soviet aggression" just a few years ago.

That cunt still thinks the Confederate States of America exists.

It's impossible to know if these people are this dumb, or they think Americans are so dumb, they still think the USSR exists.

Great summary of many things already covered in this thread: https://archive.ph/PSPAC

richwicks says

"the Soviet aggression"

If it walks like a duck and quacks like a duck....

The token BS name change means diddly squat. They retained Soviet anthem, they retained KGB in power, they keep worshipping fucking mass murderer Joseph Stalin and the mummy of another mass murderer - Lenin - is still prominently displayed on the Red Square. And their military still flying red flags with hammer and sickle in battle. It's the same old CCCP with sane peeps in power pursuing same imperial goals using same methods.

richwicks says

When you, or anybody, references the CCCP or the USSR, you just look stupid. Maxine Waters was talking about "the Soviet aggression" just a few years ago. She was pillared for this, because it made her look fucking stupid,

Russia is an oligarchy or plutocracy, with some western style socialism. It has some state owned industries as remnants of its communist past.

As far as the state of the plutocracy's economy, Russia's debt to GDP ratio continues to remain very, very low as compared to western countries.
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.

RWSGFY says

The token BS name change means diddly squat. They retained Soviet anthem, they retained KGB in power, they keep worshipping fucking mass murderer Joseph Stalin and the mummy of another mass murderer - Lenin

When the USSR existed, there was secret police and people couldn't exit the Soviet Union. There were travel restrictions imposed on everybody, people were forcibly located into areas in order to control them. There were constant shortages and there was no external trade. If as an American you entered the USSR, you were constantly tailed, and considered to be a spy. You were restricted on which locations you could go. There was absolutely no free press. External culture and communication was impossible for most soviet citizens.

I had family on the other side of the Iron Curtain in Poland. I know how it was. My cousin studied in Warsaw for a few years. He traveled to the USSR a few times when it still existed. As an American, he had more rights than our 3rd cousins did.

See this type of dog?



It's a Samoyed. In the West, they are always white, or they may have "biscuit" in their hair which is light tan. The reason this is, is because 9 dogs were taken out Siberia from the Samoyedic people, but you will know them better as "Nenets". The dogs are not always white. They are red, black, and white, like Chows. The reason everybody thinks of the Samoyed as a "entirely white dog", is because when the Iron Curtain went up, it ended any ability to contact the Samoyedic people, so the 9 dogs that came out are all that were. That dog you're looking at is a terribly inbred animal, practically a clone of my dog. It is a descendant of those 9.

That's how strong and impenetrable the Iron Curtain was. It created an entirely unique offshoot breed of dogs.

Is that still Russia today?

It's what the US is turning into. We very well may be in the position where we are trading Rubles on the black market, or Reminbi, in constant shortages, having family from other countries mailing in goods in care packages. We may be confined to "15 minute cities", and having corporations which control our government entirely dominate and control food production. We may not be able to get information from overseas and where we're all constantly monitored for our political alignment with the government.

You do nothing about that and say nothing about that. You only worry about the enemies the propaganda box tells you to worry about, you vomit up the same propaganda the propaganda box tells you. How many times do you have to be lied to before you suspect you're being lied to?

Did you know in the USSR it was basically mandatory to receive Pravda and Izvestia? Every single citizen got it. You know what many Russians used these for? To literally wipe their ass, because toilet paper was in often short supply, but propaganda wasn't. You can't wipe your ass with CNN or an online copy of the NY Times though.

richwicks says

You can't wipe your ass with CNN or an online copy of the NY Times though.

Yeah you can, at least figuratively.

Users of M48 Patton (introduced 1952):

Greece: 390 M48A5 MOLF.
Germany: 20 Minenräumpanzer Keiler in service as of 2007
Iran: 180 M48A5.
Lebanon: 104 M48A5.
Morocco: 225 M48A5.
Poland: 4 Minenräumpanzer Keiler, transferred from Germany.
South Korea: Around 200 M48A3K and 400 M48A5K1/K2/KW are remaining in service with the Republic of Korea Army as of 2023.[94]
Taiwan: 450 CM-11, 100 CM-12[95]
Thailand: 105 M48A5PI.
Turkey: 758 M48A5T2 in service. All other variants, 2,250 pieces including the 1,389 M48A5T1 are phased out of active service.

One Tank can really fuck up a city
https://en.wikipedia.org/wiki/1995_San_Diego_tank_rampage
https://en.wikipedia.org/wiki/1993_Perth_tank_rampage (APC, not a tank)

The M60 is also still in service, and that's a 1959 design still used by dozens of operators from Bahrain to Spain to Turkey.

richwicks says

Did you know in the USSR it was basically mandatory to receive Pravda and Izvestia?

Resident Patnet Russia/USSR specialists strike again.

I lived in USSR for 20 yrs of my life, and we were not required to receive Pravda or Izvestiya. Neither did any of our friends.

AmericanKulak says

Users of M48 Patton (introduced 1952):

Greece: 390 M48A5 MOLF.
Germany: 20 Minenräumpanzer Keiler in service as of 2007
Iran: 180 M48A5.
Lebanon: 104 M48A5.
Morocco: 225 M48A5.
Poland: 4 Minenräumpanzer Keiler, transferred from Germany.
South Korea: Around 200 M48A3K and 400 M48A5K1/K2/KW are remaining in service with the Republic of Korea Army as of 2023.[94]
Taiwan: 450 CM-11, 100 CM-12[95]
Thailand: 105 M48A5PI.
Turkey: 758 M48A5T2 in service. All other variants, 2,250 pieces including the 1,389 M48A5T1 are phased out of active service.

One Tank can really fuck up a city
https://en.wikipedia.org/wiki/1995_San_Diego_tank_rampage
https://en.wikipedia.org/wiki/1993_Perth_tank_rampage (APC, not a tank)

The M60 is also still in service, a...

Ah, the truth...where for art thou?

Bd6r says

richwicks says

Did you know in the USSR it was basically mandatory to receive Pravda and Izvestia?

Resident Patnet Russia/USSR specialists strike again.

I lived in USSR for 20 yrs of my life, and we were not required to receive Pravda or Izvestiya. Neither did any of our friends.

Are you Russian or American? I know Americans had different privileges. Americans, which were mostly fucking pieces spies in Russia, could always go to the embassy.

It was dangerous to be at all unorthodox in the USSR. You disagreeing with that? What comrade, don't want to read the Truth and News? What's wrong comrade?

So you're familiar with the USSR. Well enlighten us about it then, tell us, correct me. I know I may be in error, my experience IS quite limited. Share your knowledge.

I bet this is where you shut the fuck up. What were doing in the USSR for 20 years? That makes you at minimum 50 years old.

I was born in USSR in one of the republics (not Ukraine), I speak Russian as good as my native language language, and I lived in USSR until it collapsed in 1991.
richwicks says

I bet this is where you shut the fuck up.

I think this is where you should shut the fuck up as you have no clue about what happened or happens over there, as evidenced by a lot of your posts.

@Patrick who knows me personally, can verify that I am telling the truth.

Yes, Bd6r is telling the truth. I have met him.

Bd6r says

I was born in USSR in one of the republics (not Ukraine), I speak Russian as good as my native language language, and I lived in USSR until it collapsed in 1991.

Always the cagey evasive bullshit from you, every fucking time. Here is where I was born (or at least grew up) until I was 18:

https://goo.gl/maps/puJsw6uXtCYDxp3F7

Bd6r says

richwicks says

I bet this is where you shut the fuck up.

I think this is where you should shut the fuck up as you have no clue about what happened or happens over there, as evidenced by a lot of your posts.

Patrick who knows me personally, can verify that I am telling the truth.

Yeah, but I don't know you.

You are very deceptive in my estimation about the current conflict with Ukraine. You actively deceive people about the situation. You are fucking delighted to see this conflict. I'm very realistic. I expect the Ukrainian population to be devastated - at least the male population and I do not expect it to recover in my lifetime.

Angela Merkel has stated outright that the whole purpose of the Minsk Accords was to buy time, to arm Ukraine because they WANTED a fucking war.

Maybe you're Chechen. The US destabilized that to, as they did Yugoslavia. Maybe Georgian, or S. Ossetian? I wonder why Mikhail Saakashvili showed up in Ukraine just in time for their "revolution"? He's US educated in Columbia University and George Washington University.

richwicks says

The US destabilized that to

Bullshit. Prove with links

Bd6r says

richwicks says

The US destabilized that to

Bullshit. Prove with links

The US follows a very consistent pattern. The US supports Islamic terrorists, always, that's why they are so adamant they don't.

https://www.russiamatters.org/node/20317

I don't know if that site is honest, but if you want more information, specific names, operations if I can get them, I can. I know my fucking government. You just don't. The US supports the PKK, despite also calling it a terrorist group. Who do you think our "Kuridsh allies" are?

The US created Al-Qaeda. Do you think it's just a coincidence that Osama binLaden is from the binLaden family, a family which the US has tight ties to. It was the US that supported the Taliban which is just the Mujahideen.

You know how the Proud Boys leader, Enrique Tarrio, turned out to be an FIB information? They always do this shit, including internationally. They control their opposition if they can.

So your source is claim by Vladimir Putin. Bullshit squared, he started second Chechen war to get elected.

richwicks says

When the USSR existed, there was secret police and people couldn't exit the Soviet Union. There were travel restrictions imposed on everybody, people were forcibly located into areas in order to control them.

They have travel restrictions in Russia now. I believe you have to carry a passport or national ID in certain areas of Russia based on what I read in the news and heard on various news outlets.

I know they do identification checks in Russia, as that is commonly done by the police there.

.

Bd6r says

So your source is claim by Vladimir Putin. Bullshit squared, he started second Chechen war to get elected.

Look, I cannot see that you've responded to me if you don't quote me.

I expect that you know that. Why do you do this?

Tell me how I'm incorrect, let me understand how I'm wrong. If you won't do that, I assume you can't do that.

I have a very open mind. It's my job, my job is critical thinking, I'm a fucking awesome engineer because I leave ego at home when I go to work. I've done this for decades. You show I'm wrong, I'll accept it and even more, I'll promote what I consider correct.

ad says

richwicks says

When the USSR existed, there was secret police and people couldn't exit the Soviet Union. There were travel restrictions imposed on everybody, people were forcibly located into areas in order to control them.

They have travel restrictions in Russia now. I believe you have to carry a passport or national ID in certain areas of Russia based on what I read in the news and heard on various news outlets.

I know they do identification checks in Russia, as that is commonly done by the police there.

They might. I don't know. The point I'm making is we shouldn't ever be like the fucking USSR. That was a shithole.

I don't know what Russia is like today, but I full on know well what the US is today, and the US is my problem, not Russia.

Doesn't anybody but me see it a LITTLE disturbing to see the US adopt the same bullshit restrictions of the USSR?

Bd6r says

I lived in USSR for 20 yrs of my life

Where? When?

Just curious about your time under communism.

On exports Russia is about where it was pre-invasion in oil exports (quantity) prices are up since then.

Don't know about its ability to import. I am sure the black markets are swarming.

https://markets.businessinsider.com/news/commodities/china-india-russian-oil-crude-moscow-war-ukraine-volumes-kpler-2023-4