Vladimir Putin has placed Russia's economy on a war footing (Image: Getty)
Skyrocketing prices of pork and falling oil prices are said to be driving a drop in Russia’s budget. Russia is struggling with food price inflation as the Kremlin continues to pour billions of pounds into defence as it continues to wage war in Ukraine.
Moscow has been slapped with heavy Western sanctions following the full-scale invasion in 2022, with businesses and consumers faced with high interest rates. Russia’s war footing has helped fuel economic growth over the past two years — by 3.6% in 2023 and 4.10% in 2024 — although it is forecast to dramatically contract in 2025. Reports in Russia suggest the Kremlin has been forced to readjust its federal budget due to weaker oil prices and even soaring prices of pork.
The Kremlin has readjusted its federal budget, according to reports in Russia's papers (Image: Getty)
According to BBC News’ Russia editor Steve Rosenberg, a Russian government paper reported that Moscow officials have recalculated the federal budget because “the treasury’s expected annual income has fallen”.
It has reportedly been set at 38.5 trillion roubles (around £358 billion), down from the predicted amount of 40.3 trillion roubles (£374 billion) — a decrease of approximately 4%.
In a video on X, Rosenberg said the information was reported by Rossiyskaya Gazeta as it shared amendments to the 2025 federal budget, as well as the planned period for 2026 and 2027.
In today’s Russian papers: federal budget readjusted due to lower oil prices; pork prices rise; One paper mocks Europe: “Like a monkey on a bicycle, Europe’s economy is careering towards the abyss.” And how “Putin threw fuel onto the fire of Trump’s vanity.” #ReadingRussiapic.twitter.com/AJJ3IjGN1P
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It claimed the main reason for the fall in revenue is a nosedive in oil and gas sales.
Oil and gas is an important part of the Russian economy and last month, the Reuters news agency reported that revenue had fallen to its lowest level in nearly two years amid weaker oil prices and a stronger rouble.
Rossiyskaya Gazeta reported that a barrel of oil in 2025 is set to cost £40.83, down from the forecast £50.82 — a fall of almost 20%.
It claimed further tweaks to the budget could be needed in the autumn but all budget obligations will be met and there is “no need to fear changes to the tax system to boost budget revenues”.
Rosenberg reported the paper said food prices will “not rise markedly”, however, the soaring price of pork was on the front page of the Moskovsky Komsomolets.
The story said experts in the meat industry report that the price of 1kg of pork, in live weight, had risen by 15% up to 145 roubles (£1.35) in Russia’s Central Federal District, which includes Moscow.
According to the report, which on the front page had a headline of ‘Pig rise in pork prices’, the amount had increased by 7% in June alone.
The newspaper also reported rising costs of utility bills.
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