The State Duma's budget and taxes committee recommended adopting Russia's 2027-2029 federal budget in the first reading on October 29. It called the plan balanced and realistic while warning of revenue risks, Vedomosti reported, citing the committee's report.

The draft puts 2027 federal revenue at RUB43.3 trillion ($535bn) and spending at RUB48.7 trillion ($602bn), a deficit of 2.2% of GDP that is planned to narrow to 1.9% in 2029. Non-oil and gas revenues make up more than 83% of the total, and the plan does not draw on the National Wealth Fund to cover the deficit.

The committee, chaired by Andrei Makarov, sees external uncertainty as the main risk, with a chance that oil and gas revenues fall short. At home it flags tighter monetary conditions, which could hit investment and consumer spending and so revenue, as well as higher-than-forecast inflation, weak productivity growth and a rising debt burden.

Lawmakers and the Accounts Chamber consider the government's inflation forecast too optimistic. It does not fully match the path of the key rate and the above-forecast indexation of utility and transport tariffs, which could stop inflation returning to target in 2027 as the government plans. The ministry forecasts Urals crude at $53 a barrel in 2027, falling to $51/b in 2029, while the Bank of Russia expects a drop to $50/b.

The 2026 oil price assumption of $61.2/b may be too low, the committee noted. The Accounts Chamber has said that hitting it would require prices to fall to $36.3/b in the fourth quarter, which is unlikely even if the Middle East conflict is settled.

This article was produced with the help of IntelliNews Lambda analytical tool