Russia to record record current account surplus of $227 billion in 2022

Russia’s current account surplus hit a record high in 2022, despite efforts by Western countries to isolate the Russian economy, the central bank said on Tuesday.

Russia’s current account balance – a measure of the difference between all the money that flows into the country through trade, investment and transfers, and the money that flows out – has grown 86% since 2021 to $227.4 billion.

Russian imports fell sharply last year amid an exodus of Western companies after the West imposed sweeping sanctions on Moscow over its invasion of Ukraine.

But the Kremlin has tried to make up for lost revenue from oil and gas exports to Europe by pivoting to China, India, and other Asian countries.

According to Chinese customs data, trade between Russia and China hit a record $190 billion last year.

As imports fell, Moscow’s trade balance (the difference between total exports and total imports) increased from $170.1 billion in the previous year to $282.3 billion in 2022.

The central bank said higher commodity prices throughout 2022 helped boost the current account balance, while imports recovered slowly in the second half of the year.

Russia’s export earnings are set to come under renewed pressure in 2023 as Western and Japanese sanctions on Russian oil are fully implemented.

The G7 will extend its oil embargo beyond crude to include Russian petroleum products from February 5.

Analysts say this could reduce Russian oil production by up to 1 million barrels per day (bpd) in the first quarter of 2023.