Russia said to weigh cut to 2026 GDP forecast on low oil prices

Russia said to weigh cut to 2026 GDP forecast on low oil prices

Russia Considers Downgrading 2026 GDP Forecast Amid Oil Revenue Slump

Russia is reportedly evaluating a downward revision to its 2026 GDP growth forecast amid persistently low oil prices, declining energy revenues, and fiscal pressures, according to sources familiar with government planning. The country's budget deficit could nearly triple to 3.5–4.4% of GDP by year-end, exceeding the official target of 1.6% of GDP, as oil discounts and a strong ruble erode revenue collections.

Energy revenues, a cornerstone of Russia's budget, have fallen sharply. In January 2026, energy-related income dropped to 393.3 billion rubles ($5.13 billion), the lowest since July 2020. Analysts attribute this to a 30% reduction in Indian oil purchases, wider trade discounts for Russian crude, and the ruble's 45% appreciation against the dollar in 2025, which reduces the rouble value of dollar-denominated oil taxes. With global oil prices averaging $55 per barrel for Brent crude in early 2026—well below the budget's $59 assumption— revenues could fall 18% short of projections, exacerbating fiscal strain.

Russia's fiscal reserves, currently at 4.1 trillion rubles, are projected to deplete within a year if current trends continue. The government has already begun drawing from the National Wealth Fund (NWF) at a record pace, selling yuan and gold reserves to offset shortfalls. However, analysts warn that further reliance on domestic borrowing to finance the deficit risks reigniting inflation, while a potential ruble devaluation could trigger another price spike according to analysts.

To stabilize finances, policymakers may adjust the "cut-off" price for oil revenue transfers to the reserve fund, lowering it by $1 per year to ensure more consistent contributions during price recoveries. Spending cuts—particularly in non-defense sectors—are also under consideration, though experts caution that austerity measures could deepen an economic slowdown already marked by weak consumer demand and stagnant civilian manufacturing.

The Central Bank maintains high interest rates to curb inflation and redirect resources to the military sector, further constraining growth in civilian industries. With regional economies bracing for austerity and federal growth projections slashed to 1.3% for 2026, Russia faces a prolonged period of fiscal and economic adjustment.

($1 = 76.6000 roubles)

Reuters, Feb. 4, 2026
The Insider, Feb. 2026