Russia posted a RUB500bn ($5.4bn) federal budget surplus in March 2025 amid falling oil revenues, according to preliminary data from the Ministry of Finance.

The deficit was equivalent to 1% of GDP, well ahead of the 0.5% deficit target for this year in the budget. However, Ministry of Finance (MinFin) said this week that average oil prices are expected to come in at less than the $70 in the budget and the deficit was likely to be higher than anticipated.

MinFin missed its target last year as well with a deficit of 1.7% of GDP (-RUB3.3 trillion), which was still modest compared to the previous year’s 1.9% end of year result.

As covered by bne IntelliNews, previously in January and February the federal budget posted an unusual spike in spending and high deficits, which the ministry attributed to front-loaded expenses.

Despite a surplus recorded in March, the cumulative 1Q25 deficit stood at RUB2.2 trillion ($23.7bn), equivalent to 1% of GDP. The full-year budget anticipates a RUB1.2 trillion ($12.9bn) deficit, or 0.5% of GDP.

Federal budget revenues in March totalled RUB3.7 trillion ($39.9bn), flat year-on-year, contributing to a 4% year-on-year (y/y) increase in total revenues for 1Q25.

Oil and gas revenues declined by 17% y/y in March, while non-oil and gas revenues grew by 10% y/y. For 1Q25 overall, these revenue groups saw respective changes of -10% and +11% y/y.

Federal budget spending rose by 11% y/y to RUB3.2 trillion ($34.5bn) in March, returning to seasonal norms and driving a monthly surplus of RUB500bn ($5.4bn).

Renaissance Capital analysts caution that the rising likelihood of a global recession increases the chances of a “hard landing” for the Russian economy due to falling oil prices. In such a scenario, an expanding budget deficit would signal continued fiscal stimulus.

They argue, however, that the inflationary impact of such a stimulus would be milder than in 2022–2024.

Using National Wealth Fund (NWF) reserves to offset lost oil revenues and increasing borrowing to cover non-oil income shortfalls is seen as less inflationary than deploying these funds to ramp up spending by the analysts.