Russia is facing economic woes as the nation’s borrowing costs have reached their highest levels in five years. The financial crisis stems from recent economic sanctions from Western nations put on Russia, costing the state $40 billion, as well as remarkably reduced oil prices.
Anton Siluanov, Russia’s economic minister, said at a speech in Moscow, “We are losing around $40 billion per year due to geopolitical sanctions and we are losing some $90 billion to $100 billion per year due to oil prices falling 30 percent,” as reported by RIA Novosti news agency.
According to The Telegraph, the peak price of oil was at $115 per barrel in June 2014. If prices fall to $60 per barrel and economic sanctions intensify, Russia will fall into an unavoidable recession in 2015, the first since 2009.
The most notable explanation for this economic downturn in Russia is the economic sanctions from Western nations because of Russia’s uncooperativeness in the international system with regard to its intervention in Ukraine.
Although the sanctions have crippling effects on Russia’s economy, Prime Minister Vladmir Putin does not appear to be changing his views on Ukraine, since the policies have been widely popular with the Russian people.
While The International Business Times reported that only 40 percent of Russians feel optimistic about the economy, Putin’s approval ratings were at 85 percent two weeks ago, and a record 88 percent in September.
Editor’s Note: Information from The Telegraph and The International Business Times was used in this report.