Russia Sells 22 Tonnes of Gold in First Quarter as Budget Deficit Surges Past Forecasts

(MOSCOW, RUSSIA) – The Russian Central Bank has liquidated approximately 22 metric tonnes of physical gold from the nation’s dwindling reserves since the beginning of 2026. The move is a direct attempt to paper over a catastrophic federal budget shortfall that reached 4.6 trillion rubles (approximately $61.3 billion USD) by the end of the first quarter.

The sale of the bullion, drawn from the nearly depleted National Wealth Fund, exposes severe fiscal strain within the Russian state as it struggles to finance its ongoing war against Ukraine. According to open source Russian statistical data, the current deficit has already eclipsed the most pessimistic forecasts issued by the Russian Ministry of Finance for the entirety of 2025.

The financial haemorrhage is largely attributed to the collapse of oil and gas revenues earlier this year, the primary source of income for the Russian war machine. Despite a temporary window of opportunity provided by rising global prices linked to instability in Iran, Russia’s ability to capitalise has been systematically undermined by Ukrainian defence forces. A sustained campaign of precision strikes targeting Russian oil refineries and critical export terminals, including the facility at Tuapse, continues to disrupt the logistical chain required to move crude to international tankers.

Consequently, the regime in Moscow has resorted to liquidating hard assets to cover operational costs, including the payment of state salaries and bonuses promised to military personnel. Reports from various Russian regions indicate growing discontent as workers face prolonged delays in wage disbursements. Regional governors are increasingly confronted with a populace questioning the tangible benefits of what is locally referred to as “the Kremlin war,” as they endure air raid alerts, industrial explosions, and economic contraction with no visible fiscal support from the federal centre.

The situation points to the accelerating economic deterioration inside Russia. The National Wealth Fund, already significantly hollowed out by years of unpredictable wartime expenditure and sanctions mitigation, was reportedly meant to be left untouched in 2026. The necessity to sell physical gold signals that the central bank has exhausted less painful options for balancing the books. As the conflict extends further into 2026, the gap between the Kremlin’s narrative of economic resilience and the reality of trillion ruble deficits continues to widen.

The Kremlin has not publicly acknowledged the full extent of the economic challenges, instead attributing difficulties to external factors and broader global conditions.