The strength of Russian President Vladimir Putin’s regime is a derivative of global oil prices — in other words, weak and getting weaker. So far, however, Putin’s economic troubles have not encouraged him to call off the Kremlin-backed war against Ukraine or relinquish Crimea.
But there is hope that Russia’s economic weakness will soon hurt its ability to stir up global instability.
Russia’s economy is now in recession for the first time since 2009 after suffering a double blow from key crude oil benchmarks falling below $50 per barrel and Western sanctions.
Back when the price of oil soared to $100 a barrel, Russia took 70 percent of its export revenue from oil and gas, but that proportion is sliding to under 50 percent at the current prices. If oil stays below $50 a barrel, as it is forecast to do for much of the year, estimates are that the Russian government will lose $45 billion in revenue and that oil production, with many wells in Russia becoming unprofitable.
For the full story, please visit The Kyiv Post.