Igor Sechin speaks about the challenges facing the Russian oil industry

Heavy tax burden and prohibitive interest rates have an impact on the oil industry of the Russian Federation, said Rosneft Chief Executive Officer Igor Sechin speaking on an Energy Panel at the 27^th St. Petersburg International Economic Forum.  

Head of the Company said that the Russian oil industry is self-sufficient in terms of resource base and technologies and is capable of meeting the challenges it faces. However, the economic environment in which it operates is characterized by a number of factors.

According to, Igor Sechin, these factors include the voluntary production curtailments under the OPEC+ Agreement, and the growing sanctions pressure, in that number the price cap set for Russian oil by Western countries, the ban on use of Western financial system, logistical barriers.

The Russian oil industry is also affected by internal factors. These include high tax burden. “The industry generates over RUB 12 trillion of budget revenues with a tax burden of an average of 75% of the financial result”, Igor Sechin noted.

Head of Rosneft also drew attention to the prohibitive interest rates and limited available liquidity in the financial market. “Despite a record RUB 103 trillion of liquidity within the perimeter of the Russian banking system, the industry is unable to raise financing”, Igor Sechin stated.

“It is obvious that the high efficiency of deposits with the rate of 18-19% discourages investment processes in the real economy, which are necessary for sustainable development”, Igor Sechin said.

Information & Advertising Department
Rosneft
June 8, 2024