Russia Will Raise Oil Export Tax by 17% to Record

Russia will increase its crude export tax by 17 percent to a record on June 1, after oil prices rose in March and April.

The tax will be set at $398.10 a metric ton, the seventh consecutive increase, Alexander Sakovich, deputy head of the Finance Ministry’s customs department, said by telephone in Moscow today. The current duty is $340.10 a ton, or $46.40 a barrel.


Russia revises its export taxes on crude and oil products every two months based on the previous two-month average price for Urals, the country’s benchmark export blend. That stood at a record $102.76 a barrel in the period, Sakovich said. Oil prices have risen 68 percent since the same time last year.

“The government is addicted to high oil revenues,” said Michael Teagarden, a sales trader at UBS AG in Moscow. “Russia needs to wean itself from this windfall and encourage producers to spend the money developing new fields.”

Russia’s oil production, which fell to an 18-month low of 9.72 million barrels a day in April, may decline this year for the first time in a decade as producers struggle with high costs, aging fields and new deposits in increasingly remote areas. The government is considering tax breaks to stimulate investment.

Bloomberg