Oil and gas revenues grew by 58% in the second quarter of this year compared to the last on the back of high energy prices. As for Russia’s non-oil and gas income, the situation is noticeably worse – it is down 9%.
As a result, the country’s dependence on its oil and gas extraction and export earnings has grown again — the sector’s share reached 50% of all revenues in April-June (against 32% in 2020 and 2021).
“A 9% decline in non-oil and gas revenues is a fairly serious drop. But it is quite natural in the context of Russia’s economy going through a structural transformation,” economist Sergei Khestanov, Associate Professor at RANEPA, says. “In this regard, it is more interesting to which extent Russia’s non-oil and gas revenues will fall further before they stabilize at a lower level. However, it is too early to discuss this until the results of the second (or even fourth) quarter of 2023 are published. The structural transformation is not a fast process.”