Oct. 16 (Bloomberg) -- Russia, the world's biggest energy exporter, is facing shrinking government revenue as concern that the global economy may slip into recession pushes down oil prices.

The price of Urals blend of crude fell to $68.71 a barrel today, the lowest level this year, after peaking at $142.50 a barrel in July. It has averaged $106.85 a barrel since the beginning of the year, according to Bloomberg data.

The government is set to collect less money as revenue from energy exports grows at a slower pace and the central bank continues to spend its reserves to prop up the ruble amid global financial turmoil. Energy, including crude oil and natural gas, accounted for 73 percent of all exports to the Baltics and countries outside of the former Soviet Union through August.

``If the price keeps going down they will have to send the budget back to parliament looking for spending cuts,'' said Vladimir Tikhomirov, the chief economist at UralSib Financial Corp. in Moscow, in a phone interview today. ``Even in September the budget was still in surplus, so I don't think there is a really big threat in the next three months.''

The budget surplus amounted to 8.1 percent of gross domestic product, or 2.53 trillion rubles ($100 billion) in the first nine months of this year and the budget will break even next year if the price of Urals crude averages $70 a barrel, according to Finance Minister Alexei Kudrin. The government expects the price to average more than $90 this year.

`Difficult' Future

``The next three years will be more difficult than this successful year,'' Kudrin warned lawmakers on Sept. 11 when he presented the budget.

Annual government revenue growth, adjusted for inflation, will slow to 1.8 percent next year, compared with 13.8 percent this year, according to Kudrin. Budget spending will rise 12.2 percent in real terms in 2009.

The average annual price of Urals blend of crude is unlikely to fall below $60 a barrel ``for a long time,'' Arkady Dvorkovich, an aide to President Dmitry Medvedev, said on Oct. 9.

Russia supplies a quarter of Europe's gas consumption and European gas prices track the price of oil with a six to nine month time-lag. Russia's state-run gas export monopoly OAO Gazprom earned $44.8 billion in 2007 on natural-gas exports to Europe and expects to surpass that amount this year.

High energy prices have helped the economy expand almost 7 percent a year on average over the last decade. The country was pushed to the edge of bankruptcy in 1998 when the oil price dropped to $10 a barrel and the government defaulted on $40 billion of debt and devalued the ruble.

The ruble slid as much as 0.6 percent to 26.4094 per dollar, the weakest since Feb. 13, 2007, as the price of oil fell to this year's record low. It was at 26.3412 as of 12:01 p.m. in Moscow, from 26.2525 yesterday.

``Given the speed of global events it's hard to say when oil prices will stabilize,'' Tikhomirov said.

To contact the reporter on this story: Maria Levitov in Moscow at mlevitov@bloomberg.net

Last Updated: October 16, 2008 05:32 EDT