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Financials

UPDATE 1-Russia's budget could get $27 bln oil and gas revenue boost in 2021 - ministry

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MOSCOW, March 11 (Reuters) - Russia’s federal budget could get a boost of more than 2 trillion roubles ($27 billion) from additional oil and gas revenues this year if oil prices and the rouble exchange rate remain at current levels, the finance ministry said on Thursday.

These additional funds would be transferred to Russia’s National Wealth Fund, the ministry added.

While oil prices, the lifeblood of Russia’s economy, have recovered to levels of around a year ago, the rouble is about 15% weaker as investors worry about the potential for more Western sanctions against Moscow amid ongoing tensions.

Analysts have said Russia’s budget deficit, projected at 2.4% of gross domestic product (GDP) this year, could narrow to 0.5% to GDP or even turn into a surplus if oil prices and the rouble remain around current levels.

That could come in handy for the authorities ahead of parliamentary elections this autumn, which will be the last major vote before a presidential election due in 2024.

Thanks to additional inflows, Russia may also slash its borrowing by 600-700 billion roubles this year from the originally planned 3.7 trillion in OFZ treasury bonds, allowing the state to keep its debt to GDP at no more than 20% over three years.

$1 = 73.4400 roubles Reporting by Darya Korsunskaya. Writing by Alexander Marrow. Editing by Katya Golubkova and Mark Potter

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