Russian Oil Revenues Hit Pandemic Lows Amid US-EU Sanctions

Russian state revenues from oil and gas taxes fell to 393 billion rubles ($5.1 billion) in January 2026, the lowest level since the COVID-19 pandemic. This decline is the result of a coordinated effort by the United States and European Union to squeeze the Kremlin's finances. The United States imposed sanctions on major oil companies Rosneft and Lukoil on November 21, while the EU began banning fuels refined from Russian crude on January 21.

Donald Trump further diminished Russian revenue by applying tariff pressure on India to halt crude imports, which saw shipments drop from 2 million barrels per day in October to 1.3 million in December. Reports indicate that President Narendra Modi agreed to stop these imports in exchange for lower US tariffs. To sustain war efforts in Ukraine and manage slowing GDP growth, President Vladimir Putin has increased borrowing from domestic banks and used the Duma to raise the value-added tax from 20% to 22%.

Ongoing pressure includes targeting Russia's shadow fleet of tankers and Ukrainian strikes on refineries. European Commission President Ursula von der Leyen has proposed a full ban on shipping services for Russian oil to further compel Russia to end the war. While some data from the IEA suggests total revenue rose slightly to $11.1 billion in January due to price increases for specific products, official tax takes show a sharp year-on-year decline.