Oil production in Russia gets more expensive every year and pushes up fuel prices

Sergey Kondratiev, Principal Director on Economic Studies at the Institute for Energy and Finance, commented to Rossiyskaya Gazeta about the cost of oil production in Russia in 2023.

According to Sergey Kondratiev, the main reason for the increase in the oil production cost is raising the mineral extraction tax, which depends on world oil prices, the dollar exchange rate against the ruble, and some other indicators. Urals prices in the third quarter of 2023 amounted to $ 73.7 per barrel, an increase of 51% compared to the level of the first quarter. And the dollar-ruble exchange rate increased 1.3 times, to 94.1 rubles per dollar in the third quarter of 2023 (72.8 rubles per dollar in the first quarter). As a result, the ruble price of Urals increased by 95%, and this became the main driver of the growth of the "cost price". Therefore, Rosstat's estimates are, of course, objective, but reflect, rather, an increase in mineral extraction tax payments, rather than oil production costs.