Information on the current losses of the Russian Federation due to sanctions as of 06.06.2026.
1. On the night of June 6, Ukrainian drones carried out a series of attacks on military and fuel-energy facilities in St. Petersburg, Leningrad region, and Krasnodar territory.
– The Research Institute of Marine Thermal Engineering in Lomonosov, which specializes in the development of underwater weapons, including torpedoes for the Russian navy, was hit.
– An attack was also reported on the 7082nd technical mine-torpedo weapon base of the Russian navy in the Leningrad region. Ukrainian monitoring resources reported explosions and fire on the military base territory.
– In Peterhof, drones reportedly attacked a local oil depot, after which eyewitnesses observed smoke in the area. Additionally, Kronstadt, one of the key bases of the Russian Baltic fleet, was hit again.
– A separate report mentioned a strike on the Poltavska oil depot in the Krasnodar territory, where a large fire broke out after the attack.
– The series of attacks occurred a few hours after Putin’s statements at the St. Petersburg International Economic Forum about the need to further strengthen air defense systems.
2. Despite a sharp increase in tax revenues from oil production in May, oil and gas revenues of the Russian federal budget for the first five months of 2026 decreased by 30%.
– According to the Russian Ministry of Finance, oil and gas sector revenues for January–May amounted to 2.98 trillion rubles compared to 4.24 trillion rubles for the same period last year.
– In May, the mineral extraction tax (MET) on oil reached 873 billion rubles — the highest monthly figure in over a year and a half. This was due to an increase in the calculated price of Russian oil, which rose from $45 per barrel in February to $95 in April.
– However, the positive effect of rising oil prices was largely offset by the sharp increase in government payments to oil companies.
– In April and May alone, Russian refineries received 757 billion rubles in subsidies through damping mechanisms, reverse excise, and investment allowances. For comparison, the total payouts for the entire first quarter amounted to only 198 billion rubles.
– Meanwhile, revenues from the gas sector continued to decline. In May, collections from MET on gas and export duties on gas decreased compared to April, reflecting ongoing problems in the Russian gas industry after losing a significant part of the European market.
– The situation demonstrates a structural problem in Russian finances: even amid a temporary rise in oil prices, the Kremlin is increasingly forced to subsidize the energy sector to maintain its operation.
– As a result, additional income from energy exports does not translate into proportional growth in budget revenues, and overall oil and gas revenues remain significantly below last year’s level.
3. The deficit of the Russian federal budget continues to grow and has already significantly exceeded the government’s annual plan.
– According to preliminary data from the Russian Ministry of Finance, as of January–May 2026, the gap between revenues and expenses of the federal budget reached 6 trillion rubles, or 2.6% of GDP.
– This figure more than doubles the level of the same period last year and is 1.6 times the entire planned deficit for 2026. In the updated budget, the Russian authorities had set a deficit at 3.79 trillion rubles, or 1.6% of GDP.
– The increase in the budget gap is occurring amid rapidly rising government spending, a significant portion of which is related to financing the war against Ukraine, supporting the defense-industrial complex, and subsidizing certain economic sectors.
– Additional pressure on state finances is created by the reduction in oil and gas revenues. For the first five months of the year, they fell by 30% compared to the same period last year, despite a temporary rise in world oil prices.
– If the trend of rising expenses and declining revenues continues, the government will have to rely more heavily on the National Wealth Fund reserves, increase public borrowing, or seek new sources to fill the budget, which will create additional pressure on Russia’s economy.
4. One of Russia’s largest metallurgical companies, “Severstal,” has halted hiring new employees and is preparing for possible staff reductions amid a deepening crisis in the industry.
– The company has already reduced its investment program by 24% for 2026 and may further cut expenses in 2027. The company acknowledged a sharp deterioration in its financial condition: profitability dropped from 30–40% to about 12%, and cash flow turned negative.
– The main reason for the problems was a sharp decline in demand for metal products: steel consumption in Russia has decreased by more than 30% since the beginning of 2024.
– According to forecasts, by the end of 2026, the demand for steel in the country will decrease by another 7–9%. At the same time, the company does not expect a market recovery before 2027.
– The situation is worsened by sanctions and a shrinking external sales market. Russian metallurgists are forced to export part of their products with minimal profitability, while domestic demand continues to decline due to weak investment activity and prolonged economic cooling.
5. Despite Western sanctions, Putin’s inner circle continues to use expensive private planes of Western manufacture, using a network of intermediaries and companies in third countries.
– A scheme involving brokers and intermediary companies is used to circumvent sanctions. Bombardier and Gulfstream aircraft are purchased through third parties, then registered in jurisdictions that have not imposed sanctions against Russia, including the UAE, Oman, Kazakhstan, and South Africa.
– Subsequently, the aircraft are effectively at the disposal of Russian oligarchs and officials. An investigation also revealed possible involvement of European aviation companies in these schemes. According to industry representatives, some Western firms operate in the “gray zone,” selling aircraft to structures in third countries, which later transfer them to Russia.
– Sanctions have significantly complicated access for Russian elites to Western assets; however, it has not yet been possible to completely block such opportunities.
– The use of complex international schemes allows some individuals close to the Kremlin to maintain their usual lifestyle despite Russia’s international isolation and sanction pressure due to the war against Ukraine.
6. Hungary supported the idea of extending the European Union’s sanctions against Russia for a full year.
– This marked a sharp shift in Budapest’s policy after years of disputes with Brussels over sanction pressure on the Kremlin. At the meeting of EU country ambassadors, the Hungarian delegation joined the states that supported European Council President António Costa’s proposal for a 12-month extension of sanctions. The final decision is to be considered by EU leaders later this month.
– Previously, Hungary only agreed to extend sanctions every six months, using the requirement for unanimous approval as leverage during negotiations with Brussels. This meant that each subsequent extension of restrictions was accompanied by the risk of being blocked by Budapest.
– The change in position is associated with the rise to power of the new government of Prime Minister Péter Magyar, who declared a course to restore relations with the European Union after years of conflicts under Viktor Orbán’s rule. Orbán was considered Moscow’s closest ally among EU leaders and repeatedly criticized the sanction policy against Russia.
– Another indication of the change in course was the agreements reached between Budapest and Kyiv regarding the rights of the Hungarian minority in Ukraine. Following this, the Hungarian authorities announced their readiness to lift the veto on Ukraine’s transition to the next stage of EU accession negotiations.
– For Russia, Hungary’s support for the year-long extension of sanctions means reduced potential to rely on internal EU disagreements. It also enhances the predictability of the sanction regime and demonstrates the preservation of European unity regarding economic pressure on the Kremlin due to the war against Ukraine.
