Russia’s National Wealth Fund, a rainy-day reserves fund, saw its liquid assets drop by the equivalent of nearly $6 billion in May, data from the Russian finance ministry showed on Wednesday.
The National Wealth Fund had its readily available liquid assets drop by $5.75 billion (453.8 billion Russian rubles) in May, and the total value dropped to $35.5 billion (2.8 trillion rubles).
The National Wealth Fund’s liquid assets have plunged by 68% since the start of the Russian invasion of Ukraine in February 2022, Bloomberg has estimated.
The decline in oil prices in recent weeks has also reduced Russia’s revenues from oil and gas.
The value of Russian crude oil exports sank in May to the lowest level in over two years.
The volume of Russian crude oil exports in the four weeks to May 25 barely changed from the previous four weeks to May 18, but the value of the shipments dropped to the lowest level since April 2023, according to data reported by Bloomberg’s Julian Lee.
Russia’s revenues started to decline significantly in April with the crash in oil prices.
In May, oil and gas revenue for Russia’s budget totaled $6.5 billion (512.7 billion rubles), a plunge of over 35% compared to the same month of 2024. The revenue was the lowest since June 2023, according to Bloomberg calculations.
Last week, Finance Minister Anton Siluanov said that Russia could consider adjusting the oil price level in its so-called budget rule amid falling oil prices.
Under the budget rule, Russia has a baseline price of $60 per barrel of oil, above which it funnels excess revenue to its National Wealth Fund. However, when the price is below $60 per barrel – as Russia’s crude grades have been for two months now – Russia taps into the fund to offset shortfalls in revenue from oil and gas exports.
By Charles Kennedy for Oilprice.com
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