Falling Oil Prices Severely Hit Russian Budget Sanctions already imposed on Russia, coupled with falling oil prices, have had a serious impact on the Kremlin’s revenues. Russia’s richest oil company, Surgutneftegaz, has become unprofitable, posting losses of over $5 billion in the first three months of this year. Following Western sanctions, the company reported a 30% drop in profits last year and carried out a major workforce reduction, laying off nearly 3,000 employees. The fall in oil prices is also making Russia’s so-called "shadow fleet" increasingly unprofitable. Meanwhile, China’s oil giant PetroChina is preparing to shut down its largest oil refinery in the northern part of the country, according to Reuters, citing four industry sources. The company plans to halt operations at a 200,000 barrels-per-day crude unit, as well as secondary refining units. The plan is to replace the large state-run complex with a smaller enterprise.