<p>Moscow: Proceeds from oil and gas sales for <a href="https://www.deccanherald.com/tags/russia">Russia</a>'s federal budget rose by around 41 per cent year on year in the first half of the year 5.698 trillion roubles ($65.12 billion), finance ministry data showed on Wednesday, due to rising oil prices and the weaker rouble.</p>.<p>Oil and gas revenues have been the most important single source of cash for the Kremlin, accounting for around a third to a half of total federal budget proceedings for the last decade.</p>.<p>The military conflict in Ukraine has prompted the West to impose multiple sanctions aimed at curbing Russian oil and gas income that accounts for about a third of the country's federal budget.</p>.Explained | How China and Russia compete, and cooperate, in Central Asia.<p>During the first half of the year, the price of Russian flagship oil Urals blend averaged at $69.1 per barrel, above the Western-imposed price cap of $60, up from 52.5$ in the same period 2023.</p>.<p>At the same time, the rouble rate weakened to 90.8 per $1 for the period from 76.9 in January - June 2023.</p>.<p>Oil and gas revenue was down from 794 billion roubles in May and comparing to Reuters forecast of 814 billion roubles.</p>.<p>Proceeds from the mineral extraction tax (MET) rose in June to more than 1 trillion roubles from 631.6 billion roubles in the same month of 2023, according to finance ministry.</p>.<p>The data also showed that payments to refineries under the "damping mechanism" - introduced to stop companies from capitalizing on high fuel export prices and defend the domestic market - reached 158.1 billion roubles last month, down from 201.7 billion roubles in May and 78.6 billion roubles in June 2023.</p>.<p>Russian President Vladimir Putin has hailed high rates of economic growth, saying they outstrip that of Western economies.</p>.<p>The economy grew 3.6 per cent in 2023 after a revised 1.2 per cent contraction in 2022. Russia-based economists have highlighted the poor quality of economic growth, saying that production of missiles and shells may contribute to higher GDP but offer limited benefit to the population.</p>.<p>For 2024 as a whole, the government budgeted for federal revenue of 10.7 trillion roubles from oil and gas sales, up 21 per cent from 2023, when weaker oil prices and a fall in gas exports reduced the revenue by 24 per cent.</p>.<p>Russia has heavily increased defence and security spending since launching what it calls a special military operation in Ukraine in February 2022, leading to two consecutive annual deficits exceeding 3 trillion roubles, about 2 per cent of GDP.</p>.<p>It financed these with internal borrowing and by drawing on the rainy day National Wealth Fund (NWF).</p>
<p>Moscow: Proceeds from oil and gas sales for <a href="https://www.deccanherald.com/tags/russia">Russia</a>'s federal budget rose by around 41 per cent year on year in the first half of the year 5.698 trillion roubles ($65.12 billion), finance ministry data showed on Wednesday, due to rising oil prices and the weaker rouble.</p>.<p>Oil and gas revenues have been the most important single source of cash for the Kremlin, accounting for around a third to a half of total federal budget proceedings for the last decade.</p>.<p>The military conflict in Ukraine has prompted the West to impose multiple sanctions aimed at curbing Russian oil and gas income that accounts for about a third of the country's federal budget.</p>.Explained | How China and Russia compete, and cooperate, in Central Asia.<p>During the first half of the year, the price of Russian flagship oil Urals blend averaged at $69.1 per barrel, above the Western-imposed price cap of $60, up from 52.5$ in the same period 2023.</p>.<p>At the same time, the rouble rate weakened to 90.8 per $1 for the period from 76.9 in January - June 2023.</p>.<p>Oil and gas revenue was down from 794 billion roubles in May and comparing to Reuters forecast of 814 billion roubles.</p>.<p>Proceeds from the mineral extraction tax (MET) rose in June to more than 1 trillion roubles from 631.6 billion roubles in the same month of 2023, according to finance ministry.</p>.<p>The data also showed that payments to refineries under the "damping mechanism" - introduced to stop companies from capitalizing on high fuel export prices and defend the domestic market - reached 158.1 billion roubles last month, down from 201.7 billion roubles in May and 78.6 billion roubles in June 2023.</p>.<p>Russian President Vladimir Putin has hailed high rates of economic growth, saying they outstrip that of Western economies.</p>.<p>The economy grew 3.6 per cent in 2023 after a revised 1.2 per cent contraction in 2022. Russia-based economists have highlighted the poor quality of economic growth, saying that production of missiles and shells may contribute to higher GDP but offer limited benefit to the population.</p>.<p>For 2024 as a whole, the government budgeted for federal revenue of 10.7 trillion roubles from oil and gas sales, up 21 per cent from 2023, when weaker oil prices and a fall in gas exports reduced the revenue by 24 per cent.</p>.<p>Russia has heavily increased defence and security spending since launching what it calls a special military operation in Ukraine in February 2022, leading to two consecutive annual deficits exceeding 3 trillion roubles, about 2 per cent of GDP.</p>.<p>It financed these with internal borrowing and by drawing on the rainy day National Wealth Fund (NWF).</p>