A perfect storm has ravaged Russia’s national economy. With the price of oil imploding, the impact of its decline is inflicting devastating pain on the Russian economy. Fiscally , oil and natural gas revenues account for half of the state budget. The fall in oil prices is compounded by economic sanctions imposed by the European Union and the United States and Canada in response to President Putin’s aggressive polices vis a vis Ukraine.
There is nothing Putin can do about oil prices, especially with stagnant global demand and rising domestic production in the United States due to advances in shale extraction technology. However, he could mitigate the economic crisis through a more restrained policy on Ukraine. I doubt that will happen; it appears that in Russia, as with many other countries, nationalism trumps rational economic considerations.
It appears that bleak times are ahead for Moscow, and Russia’s nascent middle class. Just in the past 24 hours, the ruble dropped in value another five percent, all this in the wake of its earlier freefall when oil prices began to plummet. The erratic actions by Russia’s central bank only point to the inability by Russia’s rulers to arrest what will likely be a long-term period of economic recession and stagnation.
If Hillary Clinton runs for President of the United States in 2016, see the video about the book that warned back in 2008 what a second Clinton presidency would mean for the USA: