Russia will have record sales of natural gas this year due to high spot prices, Janis Kluge, a researcher in Austria at the German Science and Policy Foundation, told the news agency ntv.de.
Almost half of Russias budget is based on oil and gas transactions. The State earns a lot from production taxes and export taxes in rubles. Record revenue is determined by two factors: First, by energy prices in the world market and second, by the rubles exchange rate, Kluge said.
According to German experts, gas revenue will skyrocket this year, as many Russian gas contracts are adjusting to increase spot prices.
Gas prices on the spot market have increased fivefold over the past year. That means Gazprom will have record revenue, Kluge said, adding that prices will increase significantly in the next few months.
The German expert said the same situation was true for oil, which benefited from the ruble's depreciation due to Western sanctions.
Russia has planned a national budget with a ruble-USD exchange rate of 72, but the ruble is at 85, much weaker, but for exports, this is an advantage. If we multiply oil prices by the ruble exchange rate, it shows that Moscow expects to collect about 4,500 rubles/barrel of oil (52 USD), but according to current prices, this figure is increasing, up to about 7,000 rubles/barrel of oil (82 USD)".
Kluge said the profits from energy sales would be enough to cover the impact of Ukraine-related sanctions on the Russian economy, among other things, by curbing inflation.
Kluge also believes that the cost of the campaign in Ukraine is not too high and that economic measures, apart from a complete embargo, will hardly "prevent the tanks". Mr. Kluge said that the Russian Central Bank has been creative in taking countermeasures to keep the economy developing, so Russia will survive the sanctions and even have a budget surplus this year.
In another relevant development, Gazprom said on April 1 that it had increased gas transit to China via the Power of Siberia pipeline compared to the plan. Exports are part of a contract between Gazprom and the National Oil and Gas Group of China (CNPC), according to the company's report on first quarter results.
Gazprom continues to supply gas as requested by consumers, fully complying with contractual obligations. Gas supplies to China are increasing via the Power of Siberia pipeline under a long-term bilateral contract between Gazprom and the CNPC, Gazprom wrote on Telegram.
The 3,000km long cross-border pipeline began officially supplying Russian natural gas to China in 2019. The capacity of the eastern route is 61 billion cubic meters of gas per year, including 38 billion cubic meters for export.
In 2014, Gazprom and the CNPC signed a 30-year gas supply deal via the Power of Siberia pipeline. This is Gazprom's largest deal ever, and the Power of Siberia is the first natural gas pipeline between Russia and China.
