Desperate to fund its war against Ukraine as it confronts a deepening budget deficit, Russia is selling gold and mining for new ore at an unprecedented pace.
Russia should mine as much as 500 metric tons of gold in 2026, the country’s Natural Resources Minister Alexander Kozlov told the state-run Tass news agency. The estimate, Russia’s first gold-mining forecast in years, shocked gold industry experts. It is 50 percent higher than the World Gold Council’s (WGC) calculation of Russia’s 2024 gold output, and, if accurate, would leapfrog Russia ahead of China to become the world’s largest producer of gold. WGC data puts China’s 2024 production at 380 tons, ahead of Russian output of 330 tons. By comparison, the United States was the world’s fifth largest producer in 2024, mining 158 tons.
Meanwhile, the Bank of Russia sold more than $4 billion worth of gold during the first four months of 2026, according to data from the central bank showing bullion holdings dropped by nearly 26 metric tons (900,000 ounces). The country still owns close to 3,000 tons, the sixth largest gold reserves among the world’s sovereign nations.
The Bank of Russia was once the world’s biggest buyer of gold. But facing western trade sanctions and a freezing of its dollar-denominated and euro-denominated assets, Russia is increasingly reliant upon its gold hoard. Even with its gold wealth, Russia is facing a severe financial squeeze. Senior officials in the Finance Ministry and central bank have warned President Vladimir Puttin that the war against Ukraine is digging Moscow into a deep budgetary hole that will require sharp spending cuts.
