welt.de
US Oil Sanctions, Gas Halt Cripple Russia's Economy
The Russian economy, resilient for three years despite war and sanctions, faces a severe downturn in 2025 due to new US oil sanctions hitting major producers, a halt in gas transit through Ukraine, and internal economic policy discord; inflation exceeds 10 percent while the central bank interest rate is at 21 percent.
- How did the Russian government's response to previous sanctions contribute to the current economic vulnerabilities, and what role did high inflation play?
- The initial resilience of the Russian economy, characterized by 3.6 percent GDP growth in 2023, was primarily driven by high government spending on defense and the creation of two million jobs, largely in the defense sector. This growth model has reached its limits, with early indicators suggesting economic stagnation since early 2024 and high inflation eroding past gains. The new US oil sanctions are projected to cause more significant economic damage than the loss of gas transit revenue.
- What are the immediate economic consequences of the new US sanctions against the Russian oil sector and the complete halt of Russian gas transit through Ukraine?
- The Russian economy faces significant challenges in 2025, primarily due to new US sanctions targeting major oil producers Gazprom Neft and Surgutneftegas, along with related entities. These sanctions, coupled with the complete halt of Russian gas transit through Ukraine, are expected to severely impact economic growth. The impact is further amplified by a high inflation rate exceeding 10 percent and a central bank interest rate of 21 percent, hindering investment and economic activity.
- What are the potential long-term impacts of the ongoing conflict and the escalating defense budget on the Russian economy, considering the lack of coordination among economic policymakers?
- The lack of coordination between Russian economic policymakers and the central bank, coupled with the escalating defense budget (a projected increase of 25 percent to 13.5 trillion rubles in 2025), poses a major threat to economic stability. The current situation bears resemblance to the initial shock of the war's outbreak in 2022, but with the added challenge of internal discord. The outcome hinges heavily on whether the war concludes and the extent to which Russia can adapt to the new sanctions.
Cognitive Concepts
Framing Bias
The article is framed around a narrative of impending economic doom. The headline, while not explicitly stated, strongly implies negative consequences. The repeated use of phrases like "heftig" (severe), "Spitz auf Knopf" (critical), and "schmerzhaften Landung" (painful landing) contribute to a pessimistic tone. The selection of expert quotes reinforces this negative perspective.
Language Bias
The article uses strong, negatively charged language, particularly when describing the economic situation. Words like "heftig," "Spitz auf Knopf," "schmerzhaften Landung," and "Katastrophe" contribute to a sense of impending crisis. More neutral alternatives could include "substantial," "precarious," "challenging adjustment," and "significant downturn.
Bias by Omission
The article focuses heavily on negative economic indicators and expert opinions predicting a downturn. While it mentions the high defense spending, it doesn't delve into potential economic benefits or alternative perspectives on the resilience of the Russian economy, such as diversification efforts or technological advancements. The potential impact of the war on the global economy is also largely omitted.
False Dichotomy
The article presents a somewhat simplistic eitheor scenario regarding future economic growth: either peace leading to 2.5% growth or continued war leading to 0% growth. It neglects the possibility of other scenarios, such as partial escalation, de-escalation without full peace, or the impact of unforeseen events.
Sustainable Development Goals
The article highlights that while initially, Russia saw job creation, primarily in the military and arms industry, this growth model has reached its limits. The high inflation rate disproportionately affects low-income populations, exacerbating existing inequalities. The widening gap between the state-subsidized arms sector and private businesses, who don't receive similar support, contributes to economic disparity. The high interest rates imposed to combat inflation negatively affect private businesses and individuals, further deepening the economic inequality.