06/22/2015 09:56 EDT | Updated 06/22/2016 05:59 EDT

Russia cuts budget for 2018 World Cup by over $500m after slashing luxury hotels

MOSCOW - Russia has slashed over $500 million from its official budget for the 2018 World Cup after cutting spending on hotels and infrastructure.

The government is curbing most areas of public spending as the economy contracts due to the low oil price.

An order signed by Prime Minister Dmitry Medvedev and published Monday cuts the total World Cup budget by 29.2 billion rubles ($544 million) to 631.5 billion rubles ($11.8 billion).

Sports Minister Vitaly Mutko revealed in April that the government had decided to slash the number of luxury hotels, warning they could lie empty after the tournament. The reduction in the number of hotels was confirmed in law Monday.

More than half of the total budget will be funded by the federal government, which is providing 335 billion rubles ($6.25 billion).