The Russian government is considering a possible 10% cut to all "non-sensitive" spending in this year's budget, depending on how stable the rise in oil prices is due to the war in Iran.

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As the conflict in Ukraine continues, Russia is experiencing a decline in budget revenues from energy sales and an economic slowdown, which is reducing tax income from other sectors.

To address this, the government plans to channel more money into the budget reserve fund to protect it from depletion. As a result, spending cuts may be necessary. Sources indicate that the Finance Ministry has informed agencies about the need for budget reductions, prompting discussions about what to cut.

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While ordinary Russians are facing rising inflation, the impacts of the economic slowdown, fueled by high interest rates, are not yet fully felt, and government spending cuts have not led to widespread layoffs. The situation is exacerbated by Western sanctions affecting Russia’s energy sales. In early 2026, budget energy revenues halved, leading to an overall revenue decline of 11%.

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Sources caution that the rise in oil prices [following the US and Israeli attacks on Iran] may not last and cuts are necessary regardless of short-term fluctuations.

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    • Sepia@mander.xyzOP
      21·
      2 months ago

      The cuts have been announced by the Russian Ministry of Finance, the Russian Central Bank, and other Russian officials. You’ll find multiple sources for that.

      But thanks for your sophisticated comment.

        • Sepia@mander.xyzOP
          21·
          2 months ago

          Ah, a troll. You’ll find this in 5 seconds on the web.

          One is here: Russia prepares 10% cut to ‘non-sensitive’ spending in 2026

          … The Finance Ministry told Reuters in comments on this story that it is discussing measures to prioritize budget spending with ​other ministries. Andrei Gangan, head of the monetary policy department at the central bank, said an optimisation of spending can only be welcomed … Ordinary ‌people in ⁠Russia have been hit by rising inflation, but are yet to feel widespread pain from an economic slowdown, triggered by high interest rates, while cuts in government spending have not yet caused mass layoffs. The economic situation is made worse by Western sanctions which hurt Russia’s global energy sales … The third source said that the oil price growth will not be sustainable ​in the long term and the current budget situation requires spending cuts regardless of the short-term oil price fluctuations …