{"id":46878,"date":"2026-03-05T07:11:30","date_gmt":"2026-03-05T07:11:30","guid":{"rendered":"https:\/\/agooka.com\/news\/usa\/the-oil-price-spike-wont-fix-russias-strained-finances-an-analyst-says\/"},"modified":"2026-03-05T07:11:30","modified_gmt":"2026-03-05T07:11:30","slug":"the-oil-price-spike-wont-fix-russias-strained-finances-an-analyst-says","status":"publish","type":"post","link":"https:\/\/agooka.com\/news\/usa\/the-oil-price-spike-wont-fix-russias-strained-finances-an-analyst-says\/","title":{"rendered":"The oil price spike won&#8217;t fix Russia&#8217;s strained finances, an analyst says"},"content":{"rendered":"<figure><img decoding=\"async\" src=\"https:\/\/i.insider.com\/69a8f47dd3e2f1aef36a04a8?format=jpeg\" alt=\"Russia&#039;s President Vladimir Putin\"\/><figcaption>Higher oil prices typically boost President Vladimir Putin&#039;s budget, which helps finance Russia&#039;s war in Ukraine.<\/p>\n<p>Sergei Fadeichev\/Pool\/AFP\/Getty Images<\/p>\n<\/figcaption><\/figure>\n<ul>\n<li>Middle East conflict sends oil higher amid fears over Strait of Hormuz supply risks.<\/li>\n<li>Sanctions, discounts, and a strong ruble blunt the boost to Russia&#039;s oil revenue.<\/li>\n<li>An analyst warns Moscow&#039;s budget strain will persist without sustained higher prices.<\/li>\n<\/ul>\n<p>Oil prices have surged after fresh conflict in the Middle East raised fears of supply disruptions through the Strait of Hormuz \u2014 a move that would normally be a windfall for Russia.<\/p>\n<p>But this time, it may not be enough, according to an analyst.<\/p>\n<p>&quot;The current temporary spike, filtered through sanctions discounts and an unfavorable exchange rate, is unlikely to change the fundamental arithmetic,&quot; wrote Alexander Kolyandr, a senior fellow at the Center for European Policy Analysis, in a Wednesday post.<\/p>\n<p>International benchmark Brent crude and US West Texas Intermediate were more than 3% higher, trading around $84 and $77.50 per barrel respectively late on Wednesday. Both grades are around 35% higher this year.<\/p>\n<p>Russia is one of the world&#039;s largest energy exporters, and its federal budget \u2014 and by extension President Vladimir Putin&#039;s war in Ukraine \u2014 relies heavily on oil and gas revenue.<\/p>\n<p>Yet Moscow does not receive international benchmark prices for its crude. Its Urals oil trades at a sanctions-driven discount, and the strong ruble means each dollar of oil revenue converts into fewer rubles for the budget.<\/p>\n<p>As a result, Brent above $80 does not automatically deliver the revenue Russia needs.<\/p>\n<p>Oil and gas revenues plunged 50% in January from a year earlier, falling to levels last seen during the pandemic shock in 2020. Meanwhile, the federal budget ran a deficit of 1.72 trillion rubles \u2014 about 0.7% of GDP, according to Russian Finance Ministry data.<\/p>\n<p>&quot;Unless oil prices stay higher for longer and the ruble weakens significantly, the Kremlin&#039;s budget problems are here to stay,&quot; Kolyandr wrote.<\/p>\n<p>Kolyandr&#039;s analysis comes as investors weigh whether the latest Middle East escalation will trigger a sustained oil shock, particularly for Asian countries that are reliant on heavily reliant on Middle Eastern energy.<\/p>\n<p>China and India \u2014 now two of the biggest buyers of Russian crude \u2014 still source a large share of their oil from the Middle East, leaving both exposed to disruptions in the Strait of Hormuz.<\/p>\n<p>Any prolonged disruption in the Strait of Hormuz could shift trade flows, potentially increasing scrutiny on whether Asian importers turn further to discounted Russian oil.<\/p>\n<p>Markets have been volatile following the US and Israeli attacks on Iran over the weekend. On Wednesday, stocks in Asia slumped on energy security fears before rebounding on Thursday.<\/p>\n<p>Read the original article on Business Insider<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Higher oil prices typically boost President Vladimir Putin&#039;s budget, which helps finance Russia&#039;s war in Ukraine. Sergei Fadeichev\/Pool\/AFP\/Getty Images Middle East conflict sends oil higher amid fears over Strait of Hormuz supply risks. Sanctions, discounts, and a strong ruble blunt the boost to Russia&#039;s oil revenue. An analyst warns Moscow&#039;s budget strain will persist without [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":46879,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"class_list":{"0":"post-46878","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-usa"},"_links":{"self":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/posts\/46878","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/comments?post=46878"}],"version-history":[{"count":0,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/posts\/46878\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/media\/46879"}],"wp:attachment":[{"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/media?parent=46878"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/categories?post=46878"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/agooka.com\/news\/wp-json\/wp\/v2\/tags?post=46878"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}