JRL NEWSWATCH: “Russia’s Shrinking Budget Surplus Limits Putin’s War Options” – WSJ
“As its budget surplus melts away, so does the Kremlin’s ability to support the embattled economy and fund its offensive in Ukraine.”
“Russia’s war in Ukraine and … sanctions … are depleting Moscow’s coffers, hurting … Putin‘s ability to support the economy and fund the military. … add[ing] pressure on the Kremlin, which had been using ample energy revenues … to stimulate industry, placate the domestic population and finance the war. It comes amid mounting setbacks on the Ukrainian battlefields for the Russian army, … forced to withdraw from … key southern city … Kherson. Softening energy prices … and Moscow’s move to throttle … gas exports to Europe have taken a toll on public finances because oil and gas … make up the bulk of Russian state revenues. … Putin’s decision … to mobilize … [an additional roughly] 300,000 men [reprtedly] has further strained the budget …. Economists … forecast that the mobilization would deepen the recession in the fourth quarter and shave off 0.5 percentage points of GDP growth for the full year. …”