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Cracks in Russia’s Economy: Putin Faces Falling Oil Revenue and Mounting Military Losses

Падіння доходів від нафти та військові втрати створюють проблеми для Кремля. Photo: ХВИЛЯ

Frontline Developments and International Political Fallout

According to The Sunday Times commentator Mark Urban, two major factors are putting pressure on Russia’s war economy and President Vladimir Putin: the potential reopening of the Strait of Hormuz and the heavy toll on Russian forces at the front. A deal between the United States and Iran, expected to be signed in Switzerland, could clear the way for shipping through the strategic waterway. This would likely drive down global oil prices, which have remained elevated since late February. Urban noted,

“In his quest for cash, Putin has greatly benefited from higher oil prices.”

At the same time, Ukraine aims to neutralize roughly 30,000 Russian troops each month, with plans to increase that number to 50,000 by year’s end. Some Western think tanks, however, question the accuracy of Ukraine’s estimates. Meanwhile, Ukrainian drones are increasingly striking targets of symbolic importance to Russia, highlighting the conflict’s expanding scope. For instance, a swarm of unmanned aircraft reached St. Petersburg during its economic forum.

Massive Strikes and the Humanitarian Toll

Last night, Russia launched a heavy assault on Ukraine, firing around 70 missiles and over 600 drones. The attack killed at least nine people and damaged a nearly thousand-year-old monastery. Urban described the scale of death and destruction as staggering, adding that

“all of this is bad news for Putin and better news for Ukrainians.”

Fuel and basic goods are running low in the Crimean Peninsula, reflecting the dire conditions in occupied territories. Meanwhile, Starlink has cut off Russian access to its satellite system, further complicating their situation. Ukraine, for its part, has its own production capacity for millions of drones, independent of the US and Europe, giving it additional operational advantages.

The front remains tense, with ongoing strikes from both sides. International politics, particularly the US-Iran agreement, could significantly affect Russia’s economic outlook. Reopening the Strait of Hormuz might lower oil prices, making it harder for Russia to fund its military, while Ukraine continues to expand its capabilities, especially in drone warfare. These developments could shift the conflict’s balance of power considerably.

As the situation unfolds, it becomes increasingly clear that Ukraine possesses more military strengths than previously recognized. This shift in perception could significantly influence the ongoing conflict and its implications for Russia. To explore the latest insights on Ukraine's military advantages, read more in this detailed analysis.