How the War Is Crushing Russia's Economy
Ukrainian President Volodymyr Zelenskyy has released sensitive intelligence from the Foreign Intelligence Service of Ukraine (SZRU) detailing the economic toll of the war on Russia, based on internal Russian documents. According to the disclosed data, a single Russian oil company has shut down roughly 400 oil wells—a sign of major losses in that sector.
“Given the specifics of Russian oil extraction, these are significant losses, as restarting wells in Russia is far more complicated than in other oil-producing countries,” Zelenskyy stated.
The intelligence also shows a drop in Russia's oil refining capacity of at least 10% in the first months of the year. Additionally, the president highlighted a crisis in Russia's banking sector:
- Eleven financial institutions in Russia are being prepared for full liquidation;
- Eight banks have accumulated critical problems;
- Russia's federal budget deficit for the first five months of the year has reached nearly $80 billion.
Zelenskyy instructed SZRU head Oleh Luhovskyi to release information about Moscow's attempts to recruit global companies to bypass sanctions. The data also records efforts to export grain from temporarily occupied Crimea with the involvement of U.S.-based entities, as well as attempts to channel investments and technology from democratic countries into Russian Arctic oil and gas projects.
“We know how to counter this,” Zelenskyy added, emphasizing readiness to respond to new challenges.
The disclosed figures point to severe economic strain on Russia amid the war and international sanctions. The closure of oil wells and sharp decline in refining capacity could further destabilize the country's economy. Moreover, the banking sector troubles underscore the mounting pressure on Russia's financial system, with potential long-term repercussions.
The ongoing conflict has not only exacerbated Russia's economic challenges but also led to significant financial repercussions for the country. In a related report, Zelenskyy revealed that Ukrainian strikes on Russian oil facilities resulted in substantial losses amounting to $7 billion. This highlights the broader impact of military actions on Russia's already strained economy.