Russia is losing revenues from the most important segment of its economy. “The Domino Effect”
In January 2026, Russian state revenues from the oil and gas industry dropped to 393 billion rubles ($5.1 billion). For comparison, in December 2025 it was 587 billion rubles ($7.6 billion), and in January last year – 1.12 trillion rubles ($14.5 billion).. The decline in Russia's revenues from oil and gas exports is the result of new sanctions from the US and the European Union, US President Donald Trump's customs pressure on India, and stricter actions against a fleet of tankers evading sanctions and transporting Russian oil. Now the Russian economy has also been shaken by India's decision to announce that it is limiting purchases of Russian oil.
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Severe sanctions for Russia and India's decision on oil
The Trump administration imposed sanctions in November 2025 on the two largest Russian oil companies: Rosneft and Lukoil. This means that anyone who buys or ships their oil risks being cut off from the US banking system. Additionally, on January 21, the EU banned the production of fuel from Russian oil – reminds “The Independent”. The EU and the USA also put pressure on India, which limited the import of Russian oil.
Slowing growth is straining the Russian budget, and labor shortages limit potential business growth. “It's a cascading or domino effect,” concluded Mark Esposito, senior analyst at S&P Global Energy, quoted by The Independent.
See also: It hasn't been this bad for 20 years. A bad omen for the Russian economy. “He screams that the war should not have been started”
The decline in oil revenues is prompting President Vladimir Putin to borrow from Russian banks and raise taxes, which for now keeps state finances in relative balance. The Russian parliament raised, among other things, VAT up to 22 percent instead of 20 percent and increased taxes on imports of cars, cigarettes and alcohol. However, these measures only increase tensions in the war economy.
– Let's give them six months or a year, and people's thinking about the war may change, says Janis Kluge. — I don't think they are seeking peace for this reason, but they may want to reduce the intensity of the fighting, focus on specific areas of the front and slow down the war, the expert adds.
