For the first time in history, Russia has begun a real sale of physical gold from its strategic reserves, Interfax reported, citing Central Bank. ΠThe reason - probably the infrastructure of the city of Kypiansk itself is in worse condition than the country's public finances.
The country is struggling with a sharp decline in oil revenues and sanctions that are coming into force today targeting "Lyukoil" and "Rosneft", which puts the Kremlin in a difficult choice regarding the financing of the war in Ukraine.
Up until now, Moscow has only carried out virtual transactions with gold - the government sold the precious metal to the central bank, but it physically kept part of the national reserves, which amount to over 2,300 tons, the fifth largest in the world. Now the situation has changed.
"The Bank of Russia is conducting real operations to sell physical gold, similar to what it is already doing with the Chinese yuan from the National Social Welfare Fund" is the official explanation. The bank did not disclose the start date of the sale or its scale.
The National Wealth Fund owned 405.7 tons of gold before it was minted in Ukraine in February 2022. Since then, the Ministry of Finance has sold 57% of the reserves - over 232.6 tons - to cover the budget deficit.
Because The record price of gold, the value of the cash is much higher, but also significantly lower than it could have been if the end had not come.
At the beginning of November, only 173 tons of gold remained in the fund, and total liquid assets fell from $113.5 billion before the war to just $51.6 billion. Western economists predict that at the current rate the fund could run out within a year or two.
Moscow is cut off from international financial markets due to sanctions, and even China has refused to provide government loans.
Russia is drowning in cheap oil
The Kremlin's financial situation has further deteriorated as a result of oil revenues. ΠIn October, revenues from oil and gas exports fell by 27% year-on-year, and in the first ten months of 2025 they decreased by 21%.
In absolute terms, the state treasury lost revenues worth about 21 billion. euros.
The main reason is the US sanctions imposed on October 22 on "Rosneft" and "Lukoil", the two largest Russian oil companies, which together produce almost half of Russia's oil. The two companies' assets are currently on hold, with the proceeds likely to be available only after the restrictions are lifted.
The sanctions, which come into force today, have already had a chilling effect - Russian oil exports by sea have fallen by 20% in less than a month.
Πet Indian refineries responsible for the shutdown About 65% of Russian oil transported by sea has been suspended for December, and Chinese state-owned companies have canceled about 45% of planned deliveries.
Meanwhile, Ukrainian drone attacks are systematically disabling Russian refineries. ΠIn recent weeks, key facilities in Bolgograd, Ryazan, Nizhny Novgorod, etc. have been hit. No oil refineries have been completely destroyed, but the damage is very difficult to remove - Russian refineries with Western embargoed equipment, which has not been replaced by local production, and illegal imports are slow and expensive.
Refining capacity has fallen from 5.4 million barrels per day in July to around 5 million barrels in November - a drop of almost 10%.
Even the broad Slavic soul, accustomed to living in hardship, injustice and deprivation for centuries, finds it difficult to accept the rise in fuel prices at Russian gas stations.
The budget shines like a red star
Russia has been facing a high budget deficit for seven years - a situation that is not observed since 1999. Otherwise said - no one during the "Πyutin" era.
For 2026, the projected deficit is 3.8 trillion rubles, and the government is officially committed to maintaining the deficit below 1% of GDP. At the same time, the Kremlin is currently allocating 40% of the federal budget to defense and security.
"The deficit is Russia's most serious economic and political-economic problem", Volodymyr Dybrovsky, a senior economist at the Center for Social and Economic Studies in Ukraine, commented to Kuiv Inderendent.
Moscow has huge expenses for its small progress on the battlefield, and revenues are decreasing due to isolation and economic exhaustion. That is why the capitulation of Ukraine, which US President Donald Trump is practically seeking with his new peace plan, simply does not come close to Russia.