Low-margin Successes: Russia has managed to partially offset the decline in oil exports with other commodity groups, but the scope for further gains is limited
In 2025, for the first time since the start of the full-scale war with Ukraine, revenues from Russian exports declined. However, this reduction, driven by falling prices for mineral commodities, was almost half offset by increased exports of non-mineral products. In other words, amid price pressure in energy markets and extensive sanctions, Russia has managed to achieve noticeable progress in diversifying its exports.
The contraction in mineral exports compared with 2024 amounted to 15%, falling from $265 billion to $225 billion, still far from the crisis levels of 2016 and 2020, when volumes dropped to around $170 billion. At the same time, revenues from other categories, including metals, chemicals, machinery and equipment, increased by more than $23 billion.
Russian suppliers have achieved a degree of breakthrough in identifying alternative market niches. In 2022 Russian non-mineral exports fell by $18.5 billion, and in 2023 by a further $36 billion following their exit from the markets of the sanctions coalition. However, for the second consecutive year they have shown signs of recovery.
These successes, however, should not be overstated. Russia has traded premium European and North American markets for more ‘budget’ ones, where it is attempting to establish a foothold through discounts, while logistics costs have increased. As a result, Russian foreign trade is becoming increasingly low-margin.
This applies both to minerals and to other products. In the Chinese refining market, for example, Russia competes with supplies from other sanctioned countries, such as Venezuela and Iran, in the low-price segment. Growth in the physical volumes of pipeline gas deliveries to China significantly outpaces price growth, while LNG exports are declining. The sharp expansion in steel exports is largely forced, driven by a steep fall in domestic demand and sustained through dumping.
Russia’s status as a raw materials superpower was to a large extent linked to its entrenched position in the premium European market. Having lost it, Russia’s raw materials carriage is increasingly turning into a pumpkin.
Mineral decline and non-mineral depreciation
In 2025, for the first time since the start of the full-scale war against Ukraine, Russian exports declined, falling from $434.5 billion in 2024 to $418.3 billion, according to the Federal Customs Service (FCS). Prior to this, Russia had managed to avoid a reduction in export revenues despite numerous sanctions, pipeline sabotage and other constraints, including domestic ones.
The main factor behind the decline was lower prices for mineral commodities, primarily oil, as well as, in part, restrictions on the volume of hydrocarbon deliveries to Europe and Asia linked to new sanctions. As a result, revenues from exports of mineral products, which account for more than 60% of the value of Russia’s total exports, fell by almost $40 billion to $225.3 billion (under wartime conditions, the FCS publishes statistics only for aggregated commodity groups). This is 15% below the 2024 level ($264.6 billion) and 10% below the ten-year average for this category, though still far from the crisis levels of 2016 and 2020, when total mineral exports fell to $170 billion. In addition to minerals, food and agricultural raw materials also added a further negative element to the export statistics: revenues in this group declined by $1.7 billion (–4%).
However, the noticeable reduction in mineral exports did not have a particularly strong impact on the overall outcome. Russia managed to offset more than half of these losses through increased revenues from exports of metals (+$11 billion), chemical products (+$6 billion), textiles (+$1.2 billion), and the broader category of ‘Machinery, equipment and transport vehicles’ (+$6.2 billion). As a result, total exports declined by only 3.7% ($16.2 billion). In this sense, under conditions of price pressure and additional sanctions affecting energy markets, Russia has succeeded in achieving greater export diversification.
The lion’s share of the decline in mineral exports, more than 40%, was accounted for by China (–$16.2 billion). Compared with 2024, revenues from exports to China fell by 17%, while the reduction in physical volumes amounted to only 7%, according to China’s General Administration of Customs. Mineral exports to India fell by $7.5 billion in value terms, and to the EU by $4.8 billion. The five main countries of Russian exports (in addition to those already mentioned, these include Turkey and Kazakhstan) accounted for $30.4 billion in mineral export losses, with another quarter, or about $9 billion, attributable to other countries.
However, China also played the main role in offsetting the decline through other export categories. It increased purchases of Russian metals by $7.8 billion and of other products by almost $4 billion more. As a result, China accounted for about 50% of the total compensation for the fall in mineral exports. Among Russia’s major export partners, Turkey also slightly increased its purchases of metals (+$0.86 billion), while India expanded imports of chemical products (+$1.4 billion). Trade with the EU, by contrast, registered only losses. In addition to minerals, exports of other goods to the EU fell by a further $3 billion. However, export revenues recorded overall gains for other countries that are not among Russia's top five importers, accounting for a third of Russian exports. The decline in mineral supplies to these markets of $8.85 billion was offset by growth in metals (+$3.3 billion), chemicals (+$4 billion), as well as machinery, equipment and other goods (+$5 billion). The total increase in Russian non-mineral exports to these countries exceeded $12 billion.
In other words, against the backdrop of falling prices for oil and gas products in 2025, Russian suppliers made a qualitative leap in finding buyers for non-mineral products across global markets. In 2022, immediately after sanctions were introduced, Russian exports across all commodity groups except mineral products declined by $18.6 billion, even as prices for most natural resources were rising. In 2023 they fell by a further $35.7 billion, amid the decline in prices following their spike in 2022. These figures reflected the gradual withdrawal of Europe, the United States and other members of the sanctions coalition from Russian products. However, in 2024, Russian non-mineral exports already showed some growth (+$6.8 billion). In 2025, while global attention remained largely focused on Russian oil, they increased by a further $23.1 billion, or 15% compared with the previous year, softening the impact of additional sanctions and falling oil prices by more than half. As shown in the chart below, Russian exports excluding oil and gas demonstrate a recovery trend and in 2025 were 17% above the trough recorded in 2023.
Russian exports excluding mineral products, 2019–2025, billion dollars
Increase/decrease in Russian exports by commodity group and country in 2025 compared to the previous period, billion dollars
Low-margin successes and their limits
The successes of Russian foreign trade should not, however, be overstated. First, they represent only partial compensation for losses incurred. At the same time, Russia has traded premium European and North American markets for more ‘budget’ ones, where it is attempting to establish a foothold through discounts, while logistics costs have increased. As a result, Russian foreign trade is becoming increasingly low-margin.
This applies to both mineral and non-mineral exports. In the Chinese market, Russian commodity supplies are continuing to shift towards lower-price niches. As large state companies reduce purchases amid new sanctions, Russian oil is being redirected to refiners not associated with the leading market players, competing there with supplies from other sanctioned countries such as Venezuela and Iran. Disruptions to their supplies caused by domestic upheavals currently make Russian oil more attractive. In 2025 Russian oil was also noticeably cheaper for Chinese buyers than Saudi crude, according to Chinese customs data. For 80.8 million tonnes of Saudi oil, China paid $43.52 billion, or $538.6 per tonne, which is 8% higher than the average price of Russian oil ($494.45 per tonne).
Russia also occupies the cheaper segment of gas supplies and cannot gain a foothold in the more expensive segment. Russia's Gazprom reported that in 2025, deliveries via the Power of Siberia pipeline increased by 24.8%, reaching 38.8 billion cubic metres. However, according to Chinese customs data, the value of pipeline gas purchases increased by only 17% (to $9.4 billion), meaning that volumes grew while prices declined. According to the same Chinese customs data, LNG imports from Russia fell by 7% in physical terms (to 7.6 million tonnes) and by 17.6% in value terms (to $4.1 billion). As a result, Russia’s total gas exports to China, including pipeline gas and LNG, increased by only $0.5 billion, while their profitability declined noticeably.
Gold, whose prices rose rapidly, played a significant role in the growth of Russian metal exports in 2025. Nearly one third of the total increase in this commodity group, and half of the growth in metal exports to China, came from precious metals ($3.5 billion out of $7.8 billion). In physical terms Russia increased gold supplies to China ninefold, from 2.8 to 25 tonnes, according to Chinese customs data, while the price of gold rose by more than 60% over the year. As a result, the value of Russian gold exports increased almost fifteenfold, from $224 million in 2024 to $3.3 billion in 2025. However, in addition to gold, CChina also increased imports of aluminium from Russia (by $2.3 billion), copper (by $1.9 billion) and nickel (by $495 million).
China’s share in imports of Russian non-ferrous metals has been rising since 2022. Although their largest producers, Norilsk Nickel and Rusal, have not been included in EU and US sanctions lists, traditional buyers in Europe have begun to withdraw from contracts, Interfax reports. The growth in exports to China was also influenced by the ban on Russian non-ferrous metal supplies to London Metal Exchange (LME) warehouses, introduced in April 2024. These warehouses had served as an important reserve channel for metal sales, most of which is normally traded through bilateral contracts. There is little doubt, however, that Russian non-ferrous metals are sold to China at lower prices than on the London exchange.
The substitution of mineral export losses has been far less successful in India, where Russian producers managed only to increase sales of chemical products by $1.4 billion. Turkish imports of Russian mineral products declined only moderately, by $2.3 billion (–7%). Almost one third of this decline was offset by a sharp increase in steel deliveries, which again appears to have been achieved through discounts. According to the Turkish Steel Producers’ Association, Russia increased steel exports to Turkey in physical terms by 38%, to 4.5 million tonnes, becoming the leading supplier and surpassing even China (4.2 million tonnes). However, this success again relied on price reductions: in value terms the increase amounted to only 28% (from $2.66 billion to $3.4 billion), implying a decline in profitability of roughly 25%.
Overall, according to data from the BigMint pricing agency, as reported by Kommersant, Russian metallurgists increased steel exports by 13% in 2025 (to 12.1 million tonnes), trailing only Brazil in growth rates (+14%). However, this expansion was largely forced, reflecting the sharp weakening of domestic demand. The decline in demand was also the reason behind the abolition of export duties. The contraction in demand for steel on the domestic market (tanks are useless in a drone war, and investment programmes and construction are being cut back) has led to prices falling to a ten-year low, complained Anton Alikhanov, Minister for Industry and Trade, in early February. Market analysts told Kommersant that high logistics costs and competitive pressure have made exports less profitable than domestic deliveries. In practice, exports often serve primarily to keep production capacity utilised and generate foreign currency revenues rather than to produce substantial profits.
The war in Iran, which has turned one of the world's main oil and gas producing regions into a combat zone, currently makes any forecast for Russian exports in 2026 extremely uncertain. The outlook for mineral product sales has undoubtedly improved (→ Re: Russia: Temporary Beneficiary), but the fundamental factor remains that growth in supply is currently outpacing demand, meaning prices are likely to move downward once the situation stabilises. At the same time, the potential for expanding low-margin exports of non-mineral products is limited. A key factor behind Russia’s status as a raw materials superpower was its proximity to Europe, its entrenched position in the European market and the well-established logistics of supply. The loss of this market, however, in many respects turns Russia’s raw materials carriage into a pumpkin.