Western analysts and journalists have drawn attention to the fact that the liquid assets of the Russian National Welfare Fund — the country's reserve fund for a "rainy day" — have been depleted by 14% over the past few weeks.
Points of attention
- Since Russia's full-scale invasion of Ukraine, the fund's liquid assets have decreased by 68%, impacting the country's ability to replenish reserves from excess oil and gas revenues.
- The plunge in crude oil prices, attributed to factors such as US President Donald Trump's trade war, has thwarted Russia's plans to rebuild reserves, posing additional challenges to the economy.
The Kremlin is losing more and more money
Such a sharp reduction in Russian liquid assets in a short period of time has its reasons.
First of all, we are talking about a serious increase in spending on the war against Ukraine. The fall in oil prices also played a separate role in this process.
The Russian Ministry of Finance does not even hide the fact that the fund's easily accessible resources have decreased to 2.8 trillion rubles ($35.7 billion) in a month.
De facto, this marks a loss of 453.8 billion rubles ($5.8 billion) that could have been used to finance the budget deficit.
Bloomberg news agency concluded that since the Russian Federation's full-scale invasion of Ukraine in February 2022, the fund's liquid assets have decreased by 68%.
Plans to replenish reserves this year from excess oil and gas revenues have been thwarted by a plunge in crude oil prices caused by US President Donald Trump's trade war.
