Putin Signs Russian Budget for Next Year Based on $100 Oil Price

Dec. 03 2014 — 15:17
Dec. 03 2014 — 15:17
Russia's President Vladimir Putin

President Vladimir Putin on Wednesday signed into law a 15.5 trillion ruble ($290 billion) budget for next year that only balances with global oil prices averaging $100 a barrel.

Total income to state coffers in 2015 will be 15.1 trillion rubles, according to a statement on the Kremlin website.

Russia is one of the world's largest exporters of oil and natural gas, and the government depends on energy for about half of its revenues. However, oil prices have plunged about 40 percent since a June high of $115 dollars a barrel. Every $1 drop in global oil prices deprives the state of about $2 billion.

The Economic Development Ministry predicts oil prices will average $80 a barrel next year.

The budget for next year is also calculated with an average inflation level of 5.5 percent, according to the Kremlin statement. Driven up by a falling ruble and import bans, inflation has jumped in recent months, with some officials predicting it will reach 10 percent by the end of the year.

The 2015 budget will record a deficit of 430.7 billion rubles ($8 billion), according to the statement.

Russia's budget is drawn up by the Finance Ministry before being submitted to the State Duma, and then the president, for approval. The Duma approved the budget on Nov. 21.

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