As The Bell writes, citing two sources familiar with the agency’s updated macro forecast, the estimate for consumer price growth has been raised to 6.8%, which is almost a third higher than the Ministry of Economic Development’s original plan of 5.2%. According to the Ministry of Economic Development, inflation this year will accelerate compared with last year’s 5.6% as well.
Freedom Global lead analyst Natalya Milchakova named the sharp jump in gasoline prices as the key reason for the rise in annual inflation. From January to August, according to Rosstat, fuel at gas stations became more than 20% more expensive after drone strikes on dozens of oil refineries.
Amid the attacks, oil refining volumes in Russia fell to a 20-year low, and gasoline output was barely enough to cover two-thirds of domestic demand. In annual terms, the average gasoline price jumped by 25.9%, which was the highest since August 2008, according to EMISS data.
Raiffeisenbank analysts link the acceleration of inflation not only to fuel costs, but also to the weather: a cold spring, a summer drought, and a rainy autumn. They note that this year’s summer decline in vegetable prices was noticeably weaker, and cabbage became 38% more expensive, beets and onions — by 32%, potatoes — by 30%, and carrots — by 20%.
Starting October 1, Russia is set to see a record increase in utility tariffs in 17 years: by 17% on average, and in some regions — by 20% or more. At the same time, RZD tariffs are also due to be indexed, and Finam economist Olga Belenkaya warns that this will technically increase annual inflation. In July, the Bank of Russia raised its forecast to 6–7% from 4.5–5.5%, and regulator head Elvira Nabiullina said she expects a gradual recovery of the damaged refineries. The International Energy Agency expects refining in Russia to remain at around 4 million barrels per day through the end of 2027, which is one-third below normal.
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