Putin urges use of energy windfall to cut debt

Russian President Vladimir Putin has urged his government to take a cautious approach to rising energy revenues, calling for measures to safeguard the economy and public finances against external shocks.

Speaking after a sharp increase in global oil prices, Putin said additional income from energy exports should be used to reduce the heavy debt burden carried by Russian oil companies. He stressed the importance of maintaining long-term budget stability and responding to shifts in global markets.

Even before the recent rise in oil prices, Russia had been grappling with falling budget revenues driven by Western sanctions, discounts on Russian oil and the strong rouble. In response, the government prepared a package of austerity measures, including cuts to non-essential spending and steps to protect fiscal reserves.

However, the rise in energy prices as a result of the war in the Middle East has changed the outlook, generating fresh revenues that Moscow must now allocate. Putin said policymakers must adapt to changing conditions and remain alert to risks emerging in global markets and international economic relations.

(reuters, max)