Ruble Surges Past Dollar as Primary Currency for Russian Exports Amid Sanctions

For the first time since the imposition of extensive sanctions by the West following the invasion of Ukraine, the Russian ruble has emerged as the primary currency for the country’s export payments, according to new figures released by the Central Bank.

In April, the ruble comprised 52.3% of export transactions, while the proportion of currencies from nations deemed «unfriendly» by the Kremlin—such as the United States and other Western allies—dropped to a historic low of 14.1%.

The ruble has consistently represented over 50% of import payments since December 2024, peaking at 56.2% in April.

Russian leaders, including President Vladimir Putin, have celebrated the nation’s progress in reducing reliance on the dollar and shielding trade from Western influence.

However, the notable increase in ruble-denominated transactions is not primarily a reflection of global confidence in the Russian currency; rather, it stems from the proliferation of opaque payment systems that have cost Russian businesses billions and complicated the country’s economic prospects.

Dmitry Nekrasov, director of the CASE Analytical Center, reported that Russia has developed an alternative international settlement framework consisting of two parallel systems: domestic ruble transfers managed by Russian banks and foreign currency transactions, mainly in Chinese yuan, managed by overseas financial institutions. These systems are interconnected where possible, enabling rubles from Russian importers to facilitate payments for exports.

Nonetheless, this system faces inherent limitations. Russia is still experiencing a considerable trade surplus—$39.5 billion in the first four months of 2025, according to the Central Bank—and a significant portion of export revenue remains offshore.

Due to frequent mismatches in inflows and outflows, Russian companies have increasingly depended on their existing foreign currency reserves or have had to covert currencies discreetly to bridge the gap.

Nekrasov estimates that Russia’s offshore assets, excluding official reserves, now surpass $200 billion and are on the rise.

The Central Bank has reported that foreign assets increased by $20.6 billion in the initial four months of 2025, largely classified as «other investments.»

According to the Bank, this growth is partly attributed to prolonged delays in the settlement of export payments, which effectively keep the proceeds abroad and inaccessible to Western regulators.

As a result, Russia’s domestic foreign exchange market has significantly contracted. Demand for foreign currency in May fell to its lowest point since the Moscow Exchange halted trading in dollars and euros.

At the same time, major Russian exporters sold only $7.3 billion in foreign currency earnings that month, the lowest figure since mid-2023, even though they complied with government regulations mandating the conversion of nearly all their export revenues.

This trend has played a role in the strengthening of the ruble, which has appreciated steadily for six months straight.